Preamble

The House met at half-past Two o' clock

Preamble

PRAYERS

[Mr. Speaker in the Chair]

Orders of the Day — Wildlife and Countryside Bill [Lords]

Lords amendments in lieu of a Commons amendment, Lords amendments to Commons amendments, a consequential Lords amendment and a Reason for disagreeing to certain other Commons amendments, considered.
The Lords disagree to the amendment made by the Commons to insert a new clause (Daily Inspection of Snares) after clause 11 but propose the following amendments in lieu thereof:

Clause 11

Orders of the Day — PROHIBITION OF CERTAIN METHODS OF KILLING OR TAKING WILD ANIMALS.

Lords amendments: No. 1, in page 13, line 20, at end insert—
"(2A) Subject to the provisions of this Part, if any person—


(a) sets in position any snare which is of such a nature and so placed as to be calculated to cause bodily injury to any wild animal coming into contact therewith; and


(b) while the snare remains in position fails, without reasonable excuse, to inspect it, or cause it to be inspected, at least once every day,


he shall be guilty of an offence."

Orders of the Day — Clause 16

Orders of the Day — POWER TO GRANT LICENCES

Lords amendment: No. 2, in page 16, line 5, after "11" insert "(1) and (2)".

Orders of the Day — Clause 19

Orders of the Day — ENFORCEMENT

Lords amendment: No. 3, in page 19, line 10, after "11" insert "(1) or (2)".

Orders of the Day — Clause 21

Orders of the Day — PENALTIES, FORFEITURES ETC.

Lords amendment: No. 4 in page 20, line 3, after "11" insert "(1) or (2)".

Lords amendment: No. 5, in page 20, line 6, after "section" insert "11(2A)".

Orders of the Day — Schedule 16

Orders of the Day — ENACTMENTS REPEALED

Lords amendment: No. 6, in page 104, line 19, at beginning insert—


"2 and 3 Geo. 5 c. 14.
The Protection of Animals (Scotland) Act 1912.
In section 9 the words "or any snare" and "or snare"."

The Under-Secretary of State for the Environment (Mr. Neil Macfarlane):: I beg to move, That this House doth agree with the Lords in the said amendments proposed in lieu of Commons amendment No. 33. 

When the House agreed on Report to provisions requiring daily inspection of snares, it did so on the clear understanding that the amendment would need some technical redrafting in another place. That was acknowledged by both sides.
The Lords amendments give full effect to the intention of the amendment that the House accepted on Report. In addition, it provides for reasonable excuses such as illness, accidents or bad weather. The maximum penalty is set at a fine of £500.

Mr. Ted Graham (Edmonton):: The House knows that we are entering the final stint of the Bill, which has occupied the House and another place for most of the year.
There have been occasions in Committee and on the Floor of the House when the issue of snares has been raised and voted on. I congratulate the Under-Secretary on his first appearance at the Dispatch Box with his new responsibilities and on taking charge of the Bill. He must know that there were occasions here and in Committee when the Opposition gave serious consideration to the possibility of not making progress on the Bill. We were uncertain of the Government's intentions.
I pay tribute to the former Under-Secretary, the hon. Member for Dumfries (Sir H. Monro), who is no longer able to take a direct involvement for the Government. I also pay tribute to the Minister for Local Government and Environmental Services for the wisdom he has shown on more than one occasion. Those Ministers recognised that the Bill was worth saving, and changes were made in it.
Before I look at the procedures involved in the amendments I feel obliged to inform the Under-Secretary that the Opposition are not satisfied that the Government's good intentions will make progress—despite what they consider to be the reality of the situation.
We shall want to look closely over the next two years at the effect of the amendments. We want to give the Government the benefit of the doubt, particularly on this amendment and others, but we shall watch closely to see whether the Government's proposal results in a satisfactory solution. If it does not, our intention as an incoming Government will be to revise the procedures we do not agree with.
We are grateful for another opportunity to consider the issue of snares. My right hon. Friend the Member for Manchester, Ardwick (Mr. Kaufman) referred at Second Reading to the snare as a vicious and a cruel device.
Progress has been made in Committee and on Report. We are now considering something different from what we wished to achieve in Committee—not the prohibition of snares but the operation of them. The operation of snares should be discussed for good reasons. Snares are considered by a wide sector of the farming community to be essential. Snares will be legalised and operated provided that there are certain safeguards and assurances.
The Minister rightly mentioned the narrow point, which the House has conceded, that snares need daily inspection. Our concern is not the damage or pain that is inflicted at the time an animal is caught, but the length of time that it is possible for the snare to be in position. The person who sets the snare does not always catch only the desired animal. He may also catch a wide range of other animals.
Experience has shown that, when a snare has been set to catch a rabbit or fox, in addition to catching those animals it catches badgers, deer, cats and dogs. Even sheep, cattle and pigs have been caught. It is essential that


snares be inspected daily. We appreciate that the previous Under-Secretary did not accept our amendments and said that they would need to be revised, but we want to ask a number of questions about the new proposal.
The RSPCA, to its credit, has served the House, as it served the Committee, faithfully and well over the many months of our consideration of the Bill. However, it says of the Lords amendment:
The RSPCA does not mince words. We are bitterly disappointed by the Government's proposals and feel that the purpose of the amendment would be completely frustrated by the Government's alternative. We believe that the proposed amendment is so negative in its approach and so hedged about with qualifications that its declared purpose could not be achieved.
I want to ask a number of questions. The wording sent to another place was based on provisions relating to traps mentioned in section 10 of the Protection of Animals Act 1911 and those relating to spring traps and snares contained in section 9 of the Protection of Animals (Scotland) Act 1912.
Why have the Under-Secretary and his colleagues ignored precedent, which has been lauded so often by Ministers in our discussion of the Bill? Why have they departed from language in existing legislation that has caused no problems?
For example, why are the words "reasonable excuse" introduced? Earl Ferrers said in another place that they were necessary to take account of cases of illness, accident or bad weather. The Government have more than once stressed the need for absolute clarity, yet they propose to introduce the term "reasonable", which, for hundreds of years, has given the courts field days in assessing and interpreting its precise meaning.
If a shepherd set a snare in the knowledge that the lambing season was imminent and thereafter failed to inspect the snare because of his commitment to the stock would that be a "reasonable excuse"? Why has the reference to the competence of a person inspecting a snare been removed? That is a crucial change, and both the 1911 and 1912 Acts use the expression. The Opposition do not intend to vote against the amendment, but the Government must spell out why that change has been made.
Are the Government really suggesting that a snare should be inspected by someone who is, or could be, incompetent, or incapable of taking remedial action? The purpose of inspection is to release a captured animal humanely or to destroy it humanely. If that is not done, the person who inspects the snare is guilty of an offence and must pay the penalty.
Another matter that has vexed the House on this Bill and thousands of others is that of enforcement. Whatever words we use, the problem of enforcement will be with us for a long time. It is a difficult problem and we suggest that it has been made even more difficult by the omissions and changes of emphasis that have taken place. If enforcement is virtually impossible, why should we bother to make such a drastically weakening provision?
We accept the sincerity of the hon. Member for Dumfries who assured us when he was Under-Secretary that he accepted the spirit of our amendments but could not accept the wording. But we strongly suspect that the change in the form of words pays scant attention to the wishes of the House. We want the new Minister to justify the way in which the words sent from this House were changed in another place.

Mr. Macfarlane:: I welcome the observations of the hon. Member for Edmonton (Mr. Graham) about the general principles of the legislation. I am aware, not only as the incoming Minister, but as one who has voted on the Bill from time to time in the past six to nine months, of the distinguished contribution and painstaking efforts of my hon. Friend the Member for Dumfries (Sir H. Monro). I pay tribute to his enormous contribution that has helped to make the Bill a possibility.
4.45 pm
Many hon. Members spoke in Committee and on Report about the matters outlined by the hon. Member for Edmonton, and there are naturally deep anxieties among animal lovers, the RSPCA and others. The hon. Member said that the RSPCA was bitterly disappointed with the Lords amendment. I am depressed to hear that, because there are safeguards in the amendment and I hope that we shall see that they are effective. Only time will tell, but the maximum penalty is £500. The hon. Member also referred to previous legislation, but that is a detailed matter for the courts to inspect.
The hon. Member for Edmonton mentioned shepherds setting snares in the lambing season. That was also raised by my hon. Friend the Member for Dumfries in Committee when he referred to the difficulties facing those in far-flung regions, especially the North. He said that snowstorms and blizzards in the Highlands would cause particular difficulties. That is the reason for including the phrase "reasonable excuse". We are looking for general competence among the individuals who will be concerned.
There are a number of question marks over any legislation. The hon. Member for Edmonton said that the Opposition would monitor the effects of this measure over the next two years. It is up to the various agencies and individuals involved to make the legislation work. The overall objectives are beyond rebuke and we now need to move on.
I believe that the Opposition should be satisfied with the amendment. I am sure that the hon. Member for Edmonton's heart is in it. He recognises that there are anxieties about how it will be implemented, but it gives full effect to the amendment that the House approved on Report. The reasonable excuses, such as illness, accident or bad weather, are effective and adequate safeguards.
I hope that the Opposition will understand that the amendment has the best interests of everyone at heart and that it will be for the courts and everyone else concerned to make sure that that is recognised.

Mr. Graham:: By leave of the House, may I reply to what the Minister has said? He has asked us to take on trust that he believes that the spirit of what the whole House wants—daily inspection by competent people—will be covered by the words of the amendment. We are prepared to take that on trust, because we have no alternative, but there are anxieties among people outside, and I am not talking of snoopers or those who look for trouble.
As a "townie", I was told more than once that no one who sets snares desires to do anything other than inspect them daily, because no one wishes to prolong an animal's suffering. We were told that snares would usually be inspected every day and we are happy to take on trust that problems caused by snowstorms, snares set during the lambing season and so on will be few and far between.
We have to give the Government the benefit of the doubt in a difficult situation. My hon. Friend the Member


for West Lothian (Mr. Dalyell) will be raising that matter later. It is not possible for us to be precise and to take account of every conceivable problem. Therefore, we shall not delay the Bill's progress.

Question put and agreed to.

Orders of the Day — Clause 28

Orders of the Day — AREAS OF SPECIAL SCIENTIFIC INTEREST

The Lords agree to the following amendment made by the Commons: In page 26, leave out lines 6 to 29 and insert——
(3) The owner or occupier of any land notified under subsection (1)(b) shall not carry out, or cause or permit to be carried out, on that land any operation specified in the notification unless—


(a) one of them has, after the commencement date, given the Council notice of a proposal to carry out the operation specifying its nature and the land on which it is proposed to carry it out; and


(b) one of the conditions specified in subsection (4) is fulfilled.

(4) The said conditions are—



(a) that the operation is carried out with the Council's written consent;


(b) that the operation is carried out in accordance with the terms of an agreement under section 16 of the 1949 Act or section 15 of the 1968 Act; and


(c) that three months have expired from the giving of the notice under subsection (3).

(5) A person who, without reasonable excuse, contravenes subsection (3) shall be liable on summary conviction to a fine not exceeding £500.

(6) It is a reasonable excuse in any event for a person to carry an operation if—


(a) the operation was authorised by a planning permission granted on an application under Part III of the Town and Country Planning Act 1971 or Part III of the Town and Country Planning (Scotland) Act 1972; or


(b) the operation was an emergency operation particulars of which (including details of the emergency) were notified to the Council as soon as practicable after the commencement of the operation.


(7) The Council shall have power to enforce the provisions of this section; but nothing in this subsection shall be construed as authorising the Council to institute proceedings in Scotland for an offence.
(8) Proceedings in England and Wales for an offence under subsection (5) shall not, without the consent of the Director of Public Prosecutions, be taken by a person other than the Council.
(9) A notification under subsection (1)(b) of land in England and Wales shall be a local land charge.

(10) A notification under subsection (1)(b) of land in Scotland shall be registered either—


(a) in a case where the land is registered in that Register, in the Land Register of Scotland; or


(b) in any other case, in the appropriate Division of the General Register of Sasines.


(11) Section 23 of the 1949 Act (which is superseded by this section) shall cease to have effect; but any notification given under that section shall have effect as if given under subsection (1)(a).
(12) Subsection (1A) shall not apply in relation to a notification of any land under subsection (1)(b) where a notification of that land under the said section 23 has effect as if given under subsection (1)(a).'.
but propose the following amendment thereto: No. 7, In subsection (3), line 1, after "land" insert "which has been".

Mr. Macfarlane:: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker (Mr. Bernard Weatherill):: With this it will be convenient to take Lords amendment No. 8.

Mr. Macfarlane:: The Lords amendments clarify two points in the clause. The first makes it clear that once land has been notified as being of special scientific interest, in accordance with the new procedures agreed by the House, all owners and occupiers, including successors in title, will be required to give the Nature Conservancy Council advance notice of harmful operations. The second amendment makes it clear that the notice must be given in writing.

Mr. Tam Dalyell (West Lothian):: Deeply concerned though I, along with colleagues, have been for the last nine months with the Bill, and deeply interested in it, may I be forgiven for saying that it will be thought a little odd by thousands of my constituents working in the truck and tractor division of British Leyland that we are discussing this afternoon relative minutiae of the Wildlife and Countryside Bill rather than the very serious, spine-chilling problems that concern the future of British Leyland.
Were there such a thing as gratitude in politics—and we all know that in British politics gratitude is a very rare commodity—the hon. Member for Dumfries (Sir H. Monro) would have been allowed to finish his work on the Wildlife and Countryside Bill, on which he has borne the heat and burden of 27 sittings in Committee, not to mention our activities on the Floor of the House. However, I suppose that Downing Street had to find ministerial niches—at any rate at Under-Secretary of State level—for those to whom it is obliged for party and personal services far remote from the Wildlife and Countryside Bill and that someone had to give way.
On account of the hon. Gentleman's helpfulness to the Opposition, and his stubbornness in combating what in our view was a less than helpful set-up at the Ministry of Agriculture, Fisheries and Food, we regret that the hon. Gentleman is no longer on the Front Bench to see his task through. Nature in the raw, which we have so often discussed in Committee Room 12, is probably less cruel in selecting its victims and certainly less random than Downing Street. In the process of culling her Ministers, the Prime Minister set her sights on the wrong stag when she disposed of the hon. Member for Dumfries. There were many others in the ministerial herd whom we would rather have seen her get rid of. I hope that those remarks will be taken in a kindly spirit and as a "thank you" to the hon. Member for Dumfries.
The new ministerial team has to be asked a direct question on amendments Nos. 7 and 8, compared with which other matters are peripheral. Does the Minister have the authority from the Treasury to provide moneys for conservation agreements? Clause 28 explicitly asks for notification of the Nature Conservancy Council, and the only reason for this is that the NCC can enter into managerial agreements to solve problems. After clause 44 we discover that the level of management payments will be decided by Ministers. If we assume that 11 to 13 per cent. of sites of special scientific interest were damaged last year, if the Nature Conservancy Council is to react, what sums will be needed? The same point, incidentally, applies to the national park authorities.
Admittedly, we do not know how many SSI agreements will be entered into, but there are 3,800 sites. Is there a


determination on the part of the Government to finance management agreements? Can we, arising out of these amendments, explore the nature of the bid placed by the NCC to the Department of the Environment in respect of the extra responsibilities that accrue to the NCC as a result of the provisions of clause 28 and of the Bill in general?
The Nature Conservancy Council's most recent surveys show that last year over 8,000 hectares of sites of special scientific interest were seriously damaged. About 50 per cent. of this resulted from agricultural and forestry operations. Even if we ignore the inevitable increase in the amount of SSSI land that will be threatened next year because of the incentives to plough up SSSIs under the new compensation system, about 4,000 hectares of SSSIs will need to be protected annually by the Nature Conservancy Council.
Most of the threats to SSSIs from agricultural operations will come in lowland areas, where the agricultural value of land is at a financial premium. Areas such as the north Kent marshes, the Somerset levels, the Nene washes and the Derwent ings are all prime SSSI grade 1 sites currently under threat. In these places an acre of land costs over £1,000, and the difference in profit between land managed for nature conservation and land under intensive agricultural systems is as much as £80 to £100 per acre.
It is the Minister of Agriculture, Fisheries and Food which will be determining the value of the management agreements that the NCC will be forced to enter into under the new provisions, and we can be sure that they will reflect accurately the revenue that might have been earned had the land in question been converted for agricultural production. Given these sets of figures, it will be necessary for the NCC to be given at least £3 million in additional revenue if it is to safeguard SSSIs properly.
It is, therefore, of paramount importance that the NCC be given enough money to make its side of the voluntary system work. If it is unable to protect sites because it has not asked for enough money, or because the Government have not given it enough money, landowners will rightly be able to claim that it is not their fault that the provisions to protect SSSIs, and land in the national parks, are not working.
Additionally, it is essential that the NCC should not find itself in a position where it cannot object to a damaging proposal simply because it does not have sufficient funds to finance management payments. If this were the case, sites would be lost by default, without the conservation case even coming to the attention of Ministers. Unless the money is forthcoming, there is no conceivable chance of the voluntary system working. The Opposition's fear is that there has been an underestimate by Government of the finances required to protect sites of special scientific interest and national park land.
Specifically, is it true that the NCC has used the figure of £600 per hectare in calculating how much money it will need to purchase land to ensure the protection of SSSIs? If the £600 per hectare assumed cost is right, is this not a gross underestimate for the lowland areas where SSSIs are most likely to come under threat? I can accept that for a hectare of Crinan moss in remotest Argyll £600 per hectare is not unreasonable, even though my fellow countrymen—and the fellow countrymen of the hon. Member for Dumfries—might value their bog at a steeper price than £600 per hectare. 

Let us journey from Argyll to lushest, rich Norfolk. Who in their right mind will assess a hectare of Halvergate at £600 a hectare? I am told by Peter Melchett that in Norfolk the going price Ls at least £3,000 a hectare. What about the Nature Conservancy Council's book? Halvergate will be the great test case in assessing how compensation agreements will work in practice. At Halvergate 1,175 acres of SSSIs have to be protected. Halvergate alone will probably cost the Broads authority and the Countryside Commission a cool £1½ million at 1980 prices over 20 years. That is the financial lead that worries us. 
5 pm
Does the Minister fully comprehend the mammoth nature of the task that is now being given to the NCC to finance SSSIs and to undertake the problem of renotifying owners and occupiers, involving one letter and possibly more to about 3,800 sites? Some of the sites will have to be revisited by a trained scientist. I understand that on average the NCC has little more than one person per area. There may be as many as 50 sites of special scientific interest in a county. It is possible that 50 to 100 persons will have to be notified on one site.
We return to the issue whether the NCC will have the wherewithal to undertake the task. Resources for the NCC are crucial to the Bill. All our work and its usefulness is triggered by the assumption that the NCC will have the resources for the task that we have given it.
We think that the written notice requirement in Lords amendment No. 8 is important. Without that provision farmers could say "I phoned your office the other day. The girl at the end of the phone said that she would give a message. Did she not pass on the message?" There must be no misunderstanding on notification. That is why we think that the Lords are right to insert the word "written".
It is the resources of the NCC that are the crucial issue. Yesterday my hon. Friend the Member for Stockport, North (Mr. Bennett)—like my hon. Friend the Member for Rother Valley (Mr. Hardy), he has played a massive part in the Bill—asked about the NCC. His question appears in column 862 of Hansard of 28 October. The Minister replied that he would deal with the question of moneys. I asked him to comment further this afternoon. I think that this is the appropriate moment to insert that question.

Mr. Macfarlane:: I am grateful to the hon. Member for West Lothian (Mr. Dalyell) for his support of Lords amendment No. 8. We, too, believe that it is important to insert the word "written". I understand the hon. Gentleman's anxieties on other matters. I agree that I said yesterday that we could discuss these matters more fully. Parliamentary Question Time does not always provide that opportunity.
It will come as no surprise to the House when I say that I do not speak on this occasion with authority from the Treasury. However, I hope that the issues that the hon. Member for West Lothian has raised will be noted in appropriate quarters. They embrace important aspects of this measure.
We shall be having urgent discussions with the interested parties in the near future. Those parties will include the NCC. On 18 September my right hon. Friend the Secretary of State spoke at a national parks conference. On that occasion he was questioned about finance. At the same time in another place the Minister of State, Ministry of Agriculture, Fisheries and Food, referred to the


financial issue at some length. He accepted that, as legislators, we must carry the tabs that follow from the legislative decisions that we ask Parliament to take. He added that the response had been intended to be encouraging.
I am unable to make detailed comments upon the statistics that the hon. Gentleman has produced. The presentation of those figures confirms that he has taken a diligent interest in the passage of the Bill. His knowledge of these subjects is inestimable. I hope that he will forgive me if I do not go into detail on the figures. I shall not be able to deal with land valuation in various regions of the United Kingdom. However, I shall consider the issue that he raised and communicate with him.
We are considering an important amendment. I confirm that we shall be having discussions with the NCC and other bodies to ascertain the estimates that they are making between now and next year. It is important to note that the funds for the NCC over the four years to date have remained at a constant level of slightly over £9 million at 1980–81 prices. Those funds have been supplemented by £4.6 million in 1978–79, £1.09 million in 1979–80 and slightly less than £300,000 in 1980–81 at 1980–81 prices. Those figures indicate that the funding has risen. I assure the House that there will be an urgent dialogue to ascertain the needs and requirements of the various organisations as we try to shape the way to implement this measure over the next few years.

Mr. Dalyell:: I ask for the leave of the House, Mr. Deputy Speaker, to speak again on the amendment.
I accept that the Minister is new in his job and will find it difficult to go into the detailed figures. However, will he confirm that the assumed cost is £600 a hectare? The areas that need the most protection are often lowland fertile areas, and £600 is an unreal sum at current land prices. One might get away with £600 in a remote mountain area, but such a sum would be unthinkable in areas of Norfolk and other similar areas. We are concerned with lowland and often extremely fertile agricultural areas, and it seems that £600 a hectare is not realistic.
I regret that the Minister does not have the authority of the Treasury. We promise the hon. Gentleman that our interest in the Bill and in the way in which it works will not come to an end this afternoon. Some of us feel that it is deeply unsatisfactory that some hon. Members sweat their guts out for honourable reasons—I include the hon. Members for Harborough (Mr. Fan), Gainsborough (Sir M. Kimball) and Hereford (Mr. Shepherd)—only to find that they are left with no positive assurances. We have made changes to the Bill and some of us will continue to monitor the consequences of our actions, perfect or imperfect though they may be, with not only the Minister's Department but the Ministry of Agriculture, Fisheries and Food and certainly the Treasury. I hope that the hon. Gentleman gets all the authority from the Treasury that he needs. It will be authority in a good cause. If the Bill does not work, the heritage will be greatly damaged and it may prove to be our last chance.
We shall monitor it. If it does not work, I make no off-the-cuff threat. The repercussion was spelt out eloquently by my right hon. Friend the Member for Manchester, Ardwick (Mr. Kaufman), who is Shadow Secretary of State for the Environment. There are serious people in the

House who, albeit reluctantly, might think that the only answer was a system of planning. This would be unacceptable in a number of quarters. However, that may be the alternative if we do not succeed in what we are doing.

Mr. Macfarlane:: I cannot give the assurance about the statistics now. I have indicated that I shall communicate with the hon. Gentleman. I give the assurance that the Government are grateful for the support that he will provide over the next couple of years in monitoring how the legislation is implemented. All Ministers within the Department of the Environment will do everything possible to make certain that the legislation works and will monitor it closely through the relevant agencies. It is a vital piece of legislation. There is still a great deal of work to do. We shall be grateful for the hon. Gentleman's support.

Question put and agreed to.

Lords amendment No. 8 agreed to.

Orders of the Day — Clause 29

Orders of the Day — ORDERS DESIGNATING CERTAIN AREAS OF SPECIAL SCIENTIFIC INTEREST

The Lords agree to the following amendment by the Commons:
In page 28, line 30, at end insert—
'(11) A report made under section 17(1) of Schedule 3 to the Nature Conservancy Council Act 1973 for any year shall set out particulars of any areas of land as respects which orders under this section have come into operation during that year.'.
but propose the following amendment thereto: No. 9, in line 1, leave out "made under section 17(1)" and insert "submitted by the Council to the Secretary of State under paragraph 17".

Mr. MacFarlane:: I beg to move, That this House doth agree with the Lords in the said amendment.
This is a technical amendment. The Nature Conservancy Council submits annual reports under schedule 3(17) to the Nature Conservancy Council Act 1973. The Lords amendment corrects an erroneous reference to reports made under section 17 of the Act. It is as simple as that.

Mr. Graham:: I agree with the Minister that this is a technical amendment. However, it provides the opportunity, which we intend to take on every occasion this afternoon, to underline, not our suspicion of, but our sensitivity over, the aspirations of the Bill being carried forward. We are here to support the Minister and his departmental colleagues in what we consider will be the battles that they will have to fight inter-departmentally, particularly with the Treasury.
>The amendment refers to a part of the Bill that will
set out particulars of any areas of land as respects which orders under this section have come into operation during that year.
We envisage that additional land will be acquired for management and other purposes and that moneys will have to be found. We do not wish to see another Act full of good intentions placed on the statute book, with Ministers with their hands on their hearts having said upstairs, in another place and here, that they want to see it work, only to find that the public say cynically that all that has happened is that a duty has been laid upon a body to carry out certain things but that the moneys to carry out those responsibilities have been denied. We do not wish to see increased responsibility and diminished funding. 


Will the Minister give the assurance that when he refers to meetings that will take place—it was helpful in the context of today's debate that he replied to my hon. Friend the Member for Stockport, North (Mr. Bennett) yesterday—they will not be along the lines of the Minister informing the bodies that their aspirations will have to go into cold storage? Will he listen sympathetically to the bids that will be made to him? Will he accept that the bodies asked to carry out the duties placed upon them by the Act will feel entitled to tell him that they require certain sums of money? I acknowledge that these are difficult times, but we want the dialogue with the bodies, particularly the Nature Conservancy Council, to be meaningful and not a sham.

Mr. Macfarlane:: I understand what the hon. Gentleman says. His remarks echo largely those of his hon. Friend the Member for West Lothian (Mr. Dalyell). I have indicated our plans for the next few months. I shall not anticipate the dialogue. That is hypothetical. I acknowledge the points made by both hon. Gentlemen on the Opposition Front Bench. Those points will form an integral part of the dialogue with the agencies, but I can give no guarantees this afternoon.

Question put and agreed to.

Orders of the Day — Clause 32

Orders of the Day — LIMESTONE PAVEMENT ORDERS

The Lords agree to the following amendment made by the Commons:
In page 31, line 20, at end insert—

'(6) In this section—

"the Commission" means the Countryside Commission in relation to England and Wales and the Countryside Commission for Scotland in relation to Scotland;

"limestone pavement" means an area of limestone which lies wholly or partly exposed on the surface of the ground and has been fissured by natural erosion;
"the relevant authority" means the county planning authority in relation to England and Wales and the authority exercising regional planning functions in relation to Scotland.'.
but propose the following amendment thereto: No. 10, in the penultimate line leave out "regional" and insert "district".

Mr. Macfarlane:: I beg to move, That this House doth agree with the Lords in the said amendment.
This was a subject raised by the hon. Member for Stockport, North (Mr. Bennett) in Committee at some length. My hon. Friend the Member for Dumfries (Sir H. Monro) and the right hon. Member for Birmingham, Small Heath (Mr. Howell) paid their tribute to the hon. Gentleman. The amendment provides that limestone pavement orders should be made in Scotland by the authorities exercising district planning functions. These are the authorities with day-to-day control over planning matters, including minerals.

Mr. Dalyell:: Comments were made by the hon. Member for Gainsborough (Sir M. Kimball) and myself in Committee about the removal of limestone pavements from areas of Sutherland by Bristol university. Subsequent correspondence has proved that we were not accurate in blaming Bristol university. I wish to make a public

apology to Sir Alec Merrison and his colleagues for the misunderstanding that arose by recalling newspaper reports that turned out to be less than accurate.

Sir Marcus Kimball (Gainsborough):: I wish to associate myself with that apology. What we said was wrong. It was being taken down and tested for shellspar. It was not limestone pavement.

Mr. Graham:: I should like the Minister to comment on some disturbing news that I have received late in the day. We are discussing a change that has come to us from another place to delete "regional" and insert "district". We are talking about the Countryside Commission. I understand that the commission is to close three of its regional offices—those at Reading, Nottingham and Manchester—and that there is to be a cut of 25 in regional staff.
It is possible, in the light of the apologies that have just been made, that I shall need to apologise later for wrong information. If, however, the information that I have received is correct, how on earth can we begin, on the last day before a Bill becomes an Act, with the news that there may be a review, perhaps by another Department or perhaps arising for some macroeconomic reason? If, in one breath, we are saying laudable things about what we want to achieve and, in the next, denying the diminished staff the resources to carry out the job, that surely makes nonsense of what we are trying to do.

Mr. Macfarlane:: I cannot make a detailed comment on the information that the hon. Gentleman has disclosed. It may or may not be accurate. I have no means of being 100 per cent. certain at the moment what are the plans of the Countryside Commission and its regional organisations. In any case, this would not be a matter for my Department. The manner in which agencies such as the Countryside Commission are organised throughout the regions is very much a matter for the commission. I shall nevertheless look into the matter and write to the hon. Gentleman as soon as possible.

Mr. Graham:: With the leave of the House, Mr. Deputy Speaker, perhaps I may speak again.
I listened carefully to the Minister. He said that the way in which the staff was disposed of might not be a matter for him. However, the reason for the way in which staff are disposed of or made redundant can arise directly out of decisions made by the Minister and his colleagues relating to finance. I appreciate that the Minister is unable to debate the matter, but he should riot pass it off as having little or nothing to do with his Department.
I repeat that if the funds to do the job properly are to be dried up or denied that will make it very difficult for people who want to do a good job of work to do so.

Mr. Macfarlane:: Perhaps I may correct the hon. Gentleman. I did not refer to the way in which the staff were disposed of. I referred to the way in which the Countryside Commission organised its regional offices throughout the land.

Question put and agreed to.

Orders of the Day — Clause 34

Orders of the Day — MARINE NATURE RESERVES

The Lords agree to the following amendment made by the Commons:

Leave out clause 34 and insert the following new clause—
(1) Where, in the case of any land covered (continuously or intermittently) by tidal waters or parts of the sea in or adjacent to Great Britain up to the seaward limits of territorial waters, it appears to the Secretary of State expedient, on an application made by the Nature Conservancy Council, that the land and waters covering it should be managed by the Council for the purpose of


(a) conserving marine flora or fauna or geological or physiographical features of special interest in the area; or


(b) providing, under suitable conditions and control, special opportunities for the study of, and research into, matters relating to marine flora and fauna and the physical conditions in which they live, or for the study of geological and physiographical features of special interest in the area,


he may by order designate the area comprising that land and those waters as a marine nature reserve; and the Council shall manage any area so designated for either or both of those purposes.
(2) An application for an order under this section shall be accompanied by—


(a) a copy of the byelaws which, if an order is made, the Council propose making under section (Byelaws for protection of marine nature reserves) for the protection of the area specified in the application; and


(b) a copy of any byelaws made or proposed to be made for the protection of that area by a relevant authority,


and an order made on the application shall authorise the making under that section of such of the byelaws proposed to be made by the Council as may be set out in the order with or without modifications.
(3) Byelaws the making of which is so authorised—


(a) shall not require the Secretary of State's consent under subsection (1) of section (Byelaws for protection of marine nature reserves); and


(b) notwithstanding anything in the provisions applied by subsection (4) of that section, shall take effect on their being made.


(4)The provisions of Schedule (Procedure in connection with orders under section (Marine nature reserves)) shall have effect as to the making, validity and date of coming into operation of orders under this section; and an order made under this section may be amended or revoked by a subsequent order so made.
(5) The powers exercisable by the Council for the purpose of managing an area designated as a marine nature reserve under this section shall include power to install markers indicating the existence and extent of the reserve.
(6) Nothing in this section or in byelaws made under section (Byelaws for protection of marine nature reserves) shall interfere with the exercise of any right of passage by a vessel other than a pleasure boat, any functions of a relevant authority, any functions conferred by or under an enactment (whenever passed) or any right of any person (whenever vested).
(7) In this section and section (Byelaws for protection of marine nature reserves)—
"enactment" includes an enactment contained in a local Act;
"local authority" means—


(a) in relation to England and Wales, a county council, a district council, the Greater London Council or a London borough council;


(b) in relation to Scotland, a regional council, an islands council or a district council;


"relevant authority" means a local authority, a water authority or any other statutory water undertakers, an internal drainage board, a navigation authority, a harbour authority, a pilotage authority, a lighthouse authority, a conservancy authority, a river purification board, a district board for a fishery district within the meaning of the Salmon Fisheries (Scotland) Act 1862, or a local fisheries

committee constituted under the Sea Fisheries Regulation Act 1966;
"vessel" includes a hovercraft and any aircraft capable of landing on water, and "pleasure boat" shall be construed accordingly.

but propose the following amendment thereto:

No. 11, in subsection (6), leave out:
any right of passage by a vessel other than a pleasure boat".

Mr. Macfarlane:: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker:: With this it will be convenient to discuss Lords amendments Nos. 12 to 16.

Mr. Macfarlane:: The Lords amendments deal with two distinct aspects of the control of pleasure boats in marine nature reserves—access and discharges. I should like to deal first with the question of access.
As it was worded when it left this House, the clause on marine nature reserves, subsection (6), allowed a byelaw to prohibit absolutely the entry of pleasure boats into a reserve. Although the Government gave categorical assurances that the byelaw-making power would never be exercised in that way, certain interests, as hon. Members who served on the Standing Committee will know, protested strongly that the mere existence of an enabling power was an infringement of the cherished rights of innocent passage.
In another place, amendments Nos. 11, 12, 13, 14 and 16 were agreed. They have the effect of removing the Secretary of State's power to confirm byelaws which could stop all pleasure boats from entering or passing through any part of a reserve at any time, while at the same time allowing the prohibition of access to certain areas within the reserve at certain times of the year. Since this is closely in line with the way in which it was expected that the previous provision would have been applied, the Government saw no need to resist. I trust that the House will feel likewise.
As it left this House, the Bill provided that discharges from pleasure craft could be controlled by byelaws while discharges from other craft could not. The Lords held that this was discriminatory. As the Bill is now worded as a result of Lords amendment No. 15, all craft are now subject to the same controls. The only effective control at present available is the Prevention of Oil Pollution Act 1971, which covers the discharge of any oil or oily substances except bilge water from boats of under 80 tons. The Dumping at Sea Act 1974, which was mentioned in another place, does not cover pleasure boats. I hope that that clarifies the matter.
What we must now do is look to the future, and to the next couple of years in particular. When section 31(5) of the Control of Pollution Act 1974 comes into force, the Secretary of State will have power to prohibit by regulation the deposit of any polluting matter into areas which he may designate. Where there is an international dimension to the problem, section 20 of the Merchant Shipping Act 1979 can be brought into play. Under that, Orders in Council could be made to give effect to any international agreement which relates to prevention, restriction or control of pollution of the sea by matter from ships. At present there is no relevant international convention in being but the subject is of great international concern, and to attempt to treat our marine nature reserves in isolation is not necessarily the most effective way forward. Pollution from outside the reserves can so easily flow in 


I asked the House to agree, as the NCC has agreed, that the broad front approach is the right one. Meanwhile, the Royal Yachting Association has agreed enthusiastically to co-operate with the NCC in drawing up a code of conduct for our marine nature reserves. If this proves ineffective and if pollution from pleasure craft is seen to be a problem, it will always be open for the NCC to make out a case for the application of the power to make a byelaw to route vessels away from sensitive areas.
I hope that what I have said will be of reassurance to the House.

Mr. Dalyell:: As will be known to the Minister—and I take this opportunity of thanking the Department for all its courtesies throughout the long passage of this Bill—I contacted the Department this morning about our worries on this issue. Has there not been a little misunderstanding? I am not casting blame on the Minister in the House of Lords. I understand that notes were passed frantically to him—which may be the source of the difficulty. I have had notes passed frantically to me by Friends of the Earth, the Royal Society for the Protection of Birds, the World Wildlife Fund, the Council for the Protection of Rural England, the Council for the National Parks, the Royal Society for the Prevention of Cruelty to Animals, the Nature Conservancy Council, the Council for the Preservations of Nature and, indeed, on occasion, the National Farmers Union——

Mr. Graham:: And the Whip!

Mr. Dalyell:: Mr. Dalyell: *Certainly the Whips—and my colleagues on the Front Bench. I know what it is like to have notes suddenly thrust in front of one, so I do not blame Lord Avon for having misunderstood one. However, I should have thought that if there had been a misunderstanding, something could be done about that by a very tiny alteration of the legislation over which we would not create difficulties. As I understand it, the directorate of rural affairs in the Department, advised by the departmental lawyers, thought that the Dumping at Sea Act would cover the dumping of rubbish from pleasure boats. I understand, however—and the Minister has confirmed it—that that is not so, because that Act concerns specific dumping of items such as sludge and sewage.**

*In reality, it is in the interests of pleasure boat users and those who are concerned about marine nature reserves that the clause be restored, because if there were no control of dumping, boats would be restricted in their access to marine nature reserves. If the clause is restored, pleasure boats would gain greater access since dumping would be illegal. If this provision goes through, is it not a fact that the pleasure boat fraternity would be the losers and would possibly be forced to do things that they do not want to do?

I understand also that there is a problem concerning the code of conduct with the Nature Co nservancy Council. One would hope that implementation of part II of the Control of Pollution Act through means of orders by the Secretary of State would take care of it in the short term, but surely that could very easily be put right next Session for the long term.

Some of us think that one of the best things to come out of the long arguments on this Bill was the preservation, in its pristine form, of the idea of the marine nature reserve. We really care about it, and we hope that this will not be vitiated by a comparatively small matter. Can it not be put

right in the early period of the next Session, when, as the Minister knows, Governmemts traditionally have very little business that is ready?**

Mr. Macfarlane:: Mr. Macfarlane: *I am sure that the hon. Gentleman will forgive me if I refrain from commenting in detail on that latter aspect. I cannot speculate on such affairs. I am grateful for his recognition of the difficulties facing Ministers in both Houses when legislation is at a certain pitch. I pay tribute to my colleague in another place, Earl Avon, who made the observation. It was an incorrect recognition, and he was ill-advised on that occasion. I hope that we have now satisfied the House. There is existing legislation. There is a framework within which we can proceed. This is of great benefit for our marine nature reserves.**

Mr. Dalyell:: Mr. Dalyell: *By leave of the House, Mr. Deputy Speaker, I should like to make a further comment.**

*Like many other things in relation to the Bill, the proof of the pudding will be in the eating.**

Question put and agreed to.

Lords amendments Nos. 12 to 16 agreed to.

The Lords agree to the following amendment made by the Commons:

Orders of the Day — After Clause 43

Orders of the Day — New Clause

Orders of the Day — DUTIES OF WATER AUTHORITIES ETC., WITH REGARD TO NATURE CONSERVATION AND THE COUNTRYSIDE

'—(1) For subsection (1) of section 22 of the Water Act 1973 (duties with respect to nature conservation and amenity) there shall be substituted the following subsection—
"(1) In formulating or considering any proposals relating to the discharge of any of the functions of water authorities, those authorities and the appropriate Minister or Ministers—


(a) shall, so far as may be consistent with the purposes of this Act and of the Land Drainage Act 1976, so exercise their functions with respect to the proposals as to further the conservation and enhancement of natural beauty and the conservation of flora, fauna and geological or physiographical features of special interest;


(b) shall have regard to the desirability of protecting buildings or other objects of archaeological, architectural or historic interest; and


(c) shall take into account any effect which the proposals would have on the beauty of, or amenity in, any rural or urban area or on any such flora, fauna, features, buildings or objects."




(2) In subsection (3) of that section the words "not being land managed as a nature reserve" shall be, omitted.


(3) After that subsection there shall be inserted the following subsections—


"(4) Where any land has been notified to a water authority under subsection (3) above, the authority shall consult with the Council before executing or carrying out any works or operations appearing to them to be likely to destroy or damage any of the flora, fauna, or geological or physiographical features by reason or which the land is of special interest.


(5) Subsection (4) above shall not apply in relation to any emergency operation particulars of which (including details of the emergency) are notified to the Council as soon as practicable after the commencement of the operation.



(6) References in this section to water authorities shall include references to internal drainage boards and the reference in subsection (3) above to the water authority in whose area the land is situated shall include a reference to the internal drainage board in whose district the land is situated." '.




but propose the following Amendment thereto: No. 17, in subsection (2), line 1, after "land" insert "for the time being

Mr. Macfarlane:: Mr. Macfarlane: *I beg to move, That this House doth agree with the Lords in the said amendment.**

Mr. Deputy Speaker:: Mr. Deputy Speaker: *With this it will be convenient to discuss Lords amendment No. 18.**

Mr. Macfarlane:: Mr. Macfarlane: *The Lords amendments correct an error in the clause concerning the duties of water authorities. Section 22(3) of the Water Act refers to land

"not being land for the time being managed as a nature reserve."

The amendments ensure that the entire expression is deleted, not just the words which appeared in the new clause about water authorities, which would have left section 22(3) of the Water Act in a nonsensical state.**

*I hope that that clarifies the matter for the House.**

Mr. Graham:: Mr. Graham: *I shall not detain the House for long. I agree that this is a technical amendment. However, it provides us with the opportunity to reinforce the significance of the changes that were made to strengthen the intentions of the Bill.**

*Subsection (1)(a) says that those concerned shall
exercise their functions with respect to the proposals as to further the conservation and enhancement",
and so on. The words "to further" are stronger than those used in paragragh (b), "shall have regard to" and also those in paragraph (c), "shall take into account".**

*We are grateful that this requirement is to be an obligation on the water and drainage authorities. They will have a duty, not merely to have regard to and wring their hands and say "What a pity; we do not have the money or the time", but to further the interests of conservation and preservation. Labour Members are happy that this requirement has become part of the Bill.**

Question put and agreed to.

Orders of the Day — Schedule 16

Orders of the Day — ENACTMENTS REPEALED

Lords amendment No. 18 agreed to.
The Lords agree to the following Amendment made by the Commons:

Orders of the Day — After Clause 44

Orders of the Day — New Clause

Orders of the Day — PAYMENTS UNDER CERTAIN AGREEMENTS OFFERED BY AUTHORITIES

(1) This section applies where—
(a) the Nature Conservancy Council offer to enter into an agreement under section 16 of the 1949 Act or section 15 of the 1968 Act providing for the making by them of payments to—


(i) a person who has given notice under section 28(3) or 29(4); or


(ii) a person whose application for farm capital grant has been refused in consequence of an objection by the Council; or


(b) the relevant authority offer to enter into a management agreement providing for the making by them of payments to a person whose application for a farm capital grant has been refused in consequence of an objection by the authority.
(2) Subject to subsection (3), the said payments shall be of such amounts as may be determined by the offeror in accordance with guidance given by the Ministers.
(3) If the offeree so requires within one month of receiving the offer, the determination of those amounts shall be referred to an arbitrator to be appointed, in default of agreement, by the Secretary of State; and where the amounts determined by the arbitrator exceed those determined by the offeror, the offeror shall—


(a) amend the offer so as to give effect to the arbitrator's determination; or


(b) except in the case of an offer made to a person whose application for a farm capital grant has been refused in consequence of an objection by the offeror, withdraw the offer.


(4) In this section—
"farm capital grant" means a grant under a scheme made under section 29 of the Agriculture Act 1970;
"management agreement" and "the relevant authority" have the same meanings as in section (Duties of agriculture Ministers)
but propose the following amendment thereto: No. 19, in subsection (3), line 3, after "arbitrator" insert "(or, in Scotland, an arbiter)"

Mr. Macfarlane:: Mr. Macfarlane: *I beg to move, That this House doth agree with the Lords in the said amendment.**

Mr. Deputy Speaker:: Mr. Deputy Speaker: *With this we may take Lords amendment No. 20.**

Mr. Macfarlane:: Mr. Macfarlane: *These are small, technical, amendments which are necessary in deference to Scots law.**

Mr. Dalyell:: Mr. Dalyell: *This is the appropriate time to ask a question of which I gave notice to the Minister and about which he kindly wrote to me. It relates to the subject of Scots law.**

*There was a report in The Observer under the name of Mr. Lane about the suppression of a report by the University of Edinburgh on matters relating to the Wildlife and Countryside Bill. Perhaps the Minister would like to comment, as he did in his letter, because I believe that he can explain the matter.**

Mr. Macfarlane:: Mr. Macfarlane: *I have no detailed comment to make. I have written to the hon. Gentleman. The report that appeared in the paper was not accurate. The representatives from the university who were credited with having generated the suppression in the first place refuted the issue as quickly as possible. That was the gist of the message that I gave the hon. Gentleman yesterday.**

Question put and agreed to.

Lords amendment No. 20 agreed to.

Orders of the Day — Clause 67

Orders of the Day — REPEALS AND SAVINGS

The Lords agree to the following amendment made by the Commons:

In page 53, leave out lines 24 to 39 and insert—

Nothing in the repeals made by this section shall affect the operation of sections 27 to 32 of the 1949 Act in relation to any surveys begun before the commencement date.
Nothing in the repeals made by this section shall affect the operations of sections 33 and 34 of the 1949 Act and Parts II, III and IV of Schedule 3 to the 1968 Act in relation to any review begun after the commencement date.
Notwithstanding the repeal by this section of the Conservation of Wild Creatures and Wild Plants Act 1975, section 9 of the Badgers Act 1973 shall continue to have effect with the amendment made by section 16 of the said Act of 1975."

but propose the following amendment thereto: No. 21, in subsection (3), last line, leave out "after" and insert "before".

Mr. Macfarlane:: Mr. Macfarlane: *I beg to move, That this House doth agree with the Lords in the said amendment.**

*Again this is a technical amendment. The Lords amendment is necessary to correct a drafting error and thus ensure that reviews that commence before the new procedures are brought into operation will be unaffected by the repeal of the present legislation.**

Question put and agreed to.

Orders of the Day — Schedule 2

Orders of the Day — BIRDS WHICH MAY BE KILLED OR TAKEN

The Lords disagree to the following amendments made by the Commons:
page 57, line 7, at end insert:
"Curlew Numenius arquata".
page 57, line 20, at end insert—
"Redshank Tringa totanus".
Lords Reason:
Because the curlew and redshank, as the only two remaining shore waders that could otherwise be shot, should be protected.

Mr. Macfarlane:: Mr. Macfarlane: *I beg to move, That this House doth not insist upon the amendments to which the Lords have disagreed.**

*I know that this matter occupied much time in debate, both in Committee and in another place, and I understand that deep views are held on all sides. We come to what can safely be said to be the substantive Lords amendment to part I. It is their disagreement to Commons amendments Nos. 143 and 144, the effect of which would be to give protection at all times to the curlew and the redshank.**

*Hon. Members will recall that their Lordships, when considering the Bill earlier in the year, voted substantially to remove the curlew and redshank from schedule 2 part 1. That is the list of birds which may be shot as legitimate quarry species outside the close season. This House disagreed with the other place in its amendments during proceedings on the Bill in Standing Committee D. The Government's attitude on amending schedules is well known and on record. It is that species should be given additional protection only where their conservation status warrants such a step, where an adequate scientific conservation case for protection is made out. We see this as an important basis for reconciling the conflicting interests in the countryside.**

*It is clear, however, that the other place feels particularly strongly about these two species. I know that Labour Members and many Conservative Members feel that the Government do not advise opposing the amendments which their Lordships voted on in favour of restoring to the list on two occasions. However, we believe that the element of conservation is an important element. I realise the deep convictions that are held on both sides. Accordingly, I urge the House to accept the amendment, recognising that their Lordships have now voted on two occasions. The objective and purpose of the Bill are of enormous importance, and hon. Members on both sides acknowledge its long-term contribution to our heritage and to conservation.**

Mr. Dalyell:: Mr. Dalyell: *Again we come to the aid of the red shank and the curlew, though I confess that to be discussing them when Leyland is in peril may seem odd to many of my constituents. Nevertheless, West Lothian, alt hough primarily concerned with the situation of Leyland workers, has redshank and curlew on its shoreline.**

*Some 30 species of wading birds visit Britain's shores. All but a few are protected by the Protection of Birds Act 1954, including species which are abundant, such as dunlin, knot and lapwing, all of which are more common than the curlew and the redshank.**

*Waders, particularly in flight, are difficult to identify, and confusion can easily arise between similar species. Reports of protected species being shot in error are received each year. It is, therefore, better to protect all shore waders to prevent such mistakes. The only species that are not protected now are the curlew and the redshank.**

*Thus, our first point concerns error, particularly when the light is not very good. Frankly, I do not believe that many people can differentiate between species in bad light or in bad conditions.**

*Waders flock and roost in mixed species parties. Thus, wader shooting causes disturbance to both protected and quarry species. Disturbance in mid-winter can cause stress and increase mortality. Although curlew and redshank, as such, are not endangered, public feeling against their being shot is very strong. Those of us who took part in the Bill received, long after the Bill was finished, representations to this effect from time to time. Even the Nature Conservancy Council recognised this and supported their removal from the shooting list in the Lords.**

*Many protected birds are more abundant than these species, yet they are protected—for example, the blackbird, the robin, the swallow, and so on—simply because society wants them to be protected. Incidentally, I do not think there can be very much fun in shooting redshank and curlew.**

*Tastes and wildfowling practices have changed. Shore waders are not a major part of the wildfowler's quarry. The Royal Society for the Protection of Birds has received reports from East Anglia of people using redshank for practice, and not even bothering to retrieve the birds once they had been shot. In the earlier debates in the Lords many wildfowling peers agreed that shore waders were unpleasant to the modern palate and therefore could see no reason why they should be shot. Some of us will say "Amen" to that.**

*The curlew and redshank occur in large numbers on British estuaries. We hold internationally important


populations of these birds. To encourage other nations to protect their bird life, we should honour these moral obligations and protect waders.**

Recent correspondence in the Shooting Times and Country Magazine has indicated that hunters themselves are not of one mind about the retention of the redshank and curlew on the hunting schedule. In the issue of 11 June 1981, Robin Brockbank, director of the British Field Sports Society, made the following comments:

"There is room for more than one opinion on many issues in the shooting world, whether they be in the firearm fees, the unrestricted shooting of lapwings or brent geese, the use of air weapons, or the tricky question of the ethical approach to wildfowling practices which has been a predominant issue in the debates in the Wildlife and Countryside Bill. As an indication of this I received a tiny mailbag on the subject of Mr. Kimball's policy on firearms fees but a not inconsiderable one and hostile at that from BFSS shooting members opposed to our decision to back WAGBI in the offence of Sunday wildfowling in England and Wales and the shooting of curlew and redshank."

In the issue of 2 July 1981, there was a letter from David Tomlinson which presented the facts in full. It was headed "Protect not shoot?" It said:

"Sir, Am I the only WAGBI member who would like to see curlew, redshank and bar-tailed godwit removed from the list of sporting quarry? In my experience, and I have been fowling on many marshes in England, Scotland and Wales, few experienced wildfowlers consider shooting these birds. Also I have met few wildfowlers who were sufficiently competent ornithologists to tell bar-tail from a black-tailed godwit or a redshank from a spotted redshank in the half light of dawn or dusk"—
[Interruption.]

I hear the Government Whip and the Solicitor-General muttering to each other. Apparently they are not conversant with the bar-tailed godwit problem.

The Solicitor-General (Sir Ian Percival):: The Solicitor-General (Sir Ian Percival): I have not been muttering at all. I am listening carefully to the hon. Gentleman.

Mr. Dalyell:: Mr. Dalyell: I suspect that the hon. and learned Gentleman was imitating a bar-tailed godwit.

The Solicitor-General:: The Solicitor-General: Oh!

Mr. Dalyell:: Mr. Dalyell:. I apologise. I do not wish to be rude to the hon. and learned Gentleman, but I thought that he was muttering to his hon. Friend at the suggestion that I should not go into all this detail.

Tomlinson goes on in his letter:

"I agree that there is no strong argument on conservation grounds for not shooting these species but it could be fairly argued that an open season for blackbirds and song thrushes would have little impact on the population of these birds, both of which made reasonable eating. However, it would be very bad public relations to shoot songbirds. In the same way I feel it is detrimental to the wildfowlers' image to shoot waders, especially as none of the trio in dispute is particularly good to eat. A September curlew well roasted may be acceptable but a January bird of the saltings is fit only for the dustbin. Much better to leave it alone and enjoy instead the most beautiful and haunting of calls across the marsh."

Although the curlew is quite a common breeding and wintering bird in Britain, we have an international responsibility for its protection. Our wintering population of about 44,000 is 15 per cent. of that wintering in the whole of Europe. Furthermore, 11 of our estuaries are sites of international importance for this species, meaning that they hold 1 per cent. or more of the wintering European population. There is an important argument that, with the removal of the whimbrel and now the bar-tailed godwit

from the list of those species which may be hunted, the curlew should also be removed on the grounds of "look alike" identification difficulties. The three species have very similar flight patterns.

In Committee, we were indebted to my hon. Friend the Member for Rother Valley (Mr. Hardy), who has considerable experience of these matters, for making the same point. My hon. Friend has a by-election in his constituency and has asked me to give his apologies to the House for not being here.

The main reason, however, for the removal of the curlew and indeed all shore waders concerns the serious disturbance that they suffer during the vital feeding and roosting periods. This disturbance affects not only quarry species but others feeding or roosting with them or nearby, including protected birds.

Although redshanks are widespread and common in Britain, they are declining as breeding birds, as they are in several other European countries. Declines are connected with habitat loss of various kinds—principally wetland and coastal reclamation.

Some 150,000 redshanks winter in Europe as a whole, of which almost one-third winter in Britain—up to 51,000 birds—where there are 20 sites of international importance for this species. Thus we have international responsibility for a substantial part of the entire winter populations of the species.

An equally important consideration that applies to all shore waders is that of serious disturbance at vital times of feeding and roosting. This applies indiscriminately to other species occurring with redshanks, whether protected or not, and possibly even more so than in the case of other waders due to the redshank's use of wider range of habitats. The redshank weighs only 4½ oz and is 10½ ins from bill to tail. The bill is 2½ ins long. The estimated numbers shot is 2,000 a year.

I go into this in some detail. Normally it would be unnecessary. But I see the hon. Members for Gainsborough (Sir M. Kimball) and Harborough (Mr. Farr) ready to pounce. I say to them with a certain amount of friendship, because they have worked very hard on the Bill "Do not spoil your contribution to all these days and months of work by pressing this matter, because it is not a worthy one for you to contest at this stage." I hope that both hon. Members will protect their reputations by not pressing the matter in view of the facts that I have put forward.

Sir Marcus Kimball:: Sir Marcus Kimball: The House will find itself in an even more difficult position if it decides to disagree with the Lords in their disagreement with the Standing Committee.

Her Majesty's intention to prorogue Parliament tomorrow morning at 9.30 has already been announced. I believe that another place is no longer sitting. If we disagreed with this disagreement and sent a message to the other place, there would be no possibility of getting back their Lordships' agreement to our disagreement with their disagreement. If we succeed in pressing this disagreement, we shall lose the Bill.

I have no desire to sacrifice the amount of work which has been put into the Bill by my right hon. and hon. Friends and Opposition Members. I am sure that no one


wishes to do that. However, I regard this disagreement of the Lords with the Commons Standing Committee as a very dangerous precedent.

I do not believe that there are sound conservation reasons why protection should be extended to the two species which are the subject of the amendment. Both are plentiful, and there is no sound conservation reason for protecting them. It is a dangerous precedent to state that, because a bird is charming, pretty or attractive or that it makes a nice noise, it must not be shot. A ptarmigan is a lovely bird. It is also great fun to shoot. A black cock is a lovely bird, but it is a game bird. The argument that, because a bird is attractive, which the curlew and redshank are, it should not be shot is very dangerous, and it represents the first step down a very slippery slope. I would never shoot a redshank or a curlew. As the hon. Member for West Lothian (Mr. Dalyell) said, only about 2,000 redshank a year are shot periodically in September round our shores.

Without any sound conservation reasons, during the dinner hour, a few unelected peers moved by emotion upset a decision of the elected Members of this House. This is a very dangerous precedent, and it is good that it should be said for once from the Government Benches and not by an Opposition Member.

Mr. Dalyell:: Mr. Dalyell: Is the hon. Member joining my right hon. Friend the Member for Bristol, South-East (Mr. Benn)?

Sir Marcus Kimball:: Sir Marcus Kimball: I am firing a warning shot against the other place for taking an emotional decision without sound conservation reasons. The other place has removed the targets from the less-well-off members of the shooting community. By doing that, it has increased the pressure for shooting on the remaining number of game birds. That is a typical action of an unelected Chamber. The other place has not come out of the argument well.

I disagree with the disagreement with the Lords, but I do not want to lose the Bill, so I shall say no more.

Sir Hector Monro (Dumfries):: Sir Hector Monro (Dumfries): I had not wished to participate in the last stages of the Bill, but I feel that I owe it to my conscience to say a word or two on the amendment. I thank the hon. Members for West Lothian (Mr. Dalyell) and for Edmonton (Mr. Graham) for their kind and touching remarks, which were warmly supported by my hon. Friend the Member for Sutton and Cheam (Mr. Macfarlane). Our reward, when the Bill is enacted tomorrow, will be improved protection and conservation in the years ahead.

My hon. Friend the Member for Gainsborough (Sir M. Kimball) has highlighted the impossible position in which we are placed, in that whatever we wanted to do, nothing further could happen; the amendment could not be reconsidered in another place. Like my hon. Friend, I am the last person who would want to lose the Bill at this stage. Therefore, there is no question of trying to take the matter a stage further by pushing it to a Division. I shall not have anything to do with that.

It is right that we should put a few matters in perspective if only to prevent such an event happening again for the wrong reasons. I remind the House that when the Bill was published under a year ago there were already many changes to the schedules dealing with bird protection. We had gone through it with a toothcomb with consultation papers and all the conservation bodies. A number of birds had been taken from the quarry schedule

and put on the protected schedule. Therefore, all the issues which were debated at length relative to the redshank, curlew and godwit had been dealt with before the schedules were printed and presented to Parliament.

I speak tonight because, speaking as a Minister, I gave an assurance in the House, and outside on a number of occasions, that there would be no impact on field sport where conservation was involved. The only issue relative to field sports that has been touched on during the passage of the Bill dealt with otter hunting. That was because the Nature Conservancy Council gave a firm recommendation that otters should be protected. They were as a result. I was quite hurt by some of the inaccurate statements made by the League Against Cruel Sports, which was running true to form.

When the schedules were discussed in another place, a great deal of careful work had taken place before the amendments were put forward on 10 March. Those amendments were to remove the three waders from the quarry schedule. It is right to remember that Lord Chelwood, who moved those amendments, gave the strong impression that on conservation grounds there was not a good case for protection. The vote, which was accentuated by the issue of the godwit, showed a majority of 51 in a House numbering only 115.

We have touched on the case for conservation. We know that there are roughly 62,000 curlews, 97,000 redshank and about 40,000 godwit wintering here. The breeding pairs are 40,000 to 70,000 curlews and 38,000 to 40,000 redshank—the godwit does not breed in the United Kingdom.

Before the debate in another place the matter had been referred to the advisory committees on the protection of birds in England and Scotland. Neither committee could recommend protection on grounds of conservation. That is important when we are considering whether birds should be added to protection or quarry schedules. There must be reason and there must be a principle running through the decisions which are made.

Like my hon. Friend the Member for Gainsborough, I have never shot a redshank or a curlew, and I never intend to. Some skilled wildfowlers—wildfowlers by and large are extremely skilled shots, know what they are doing, and know their bird recognition—wish to do so and have done so for generations. As has been said, at certain stages of the season, particularly in early autumn, they are good eating. Therefore, judging from the figures, there is no reason to say that for conservation reasons one should put those two waders—the curlew and the redshank—on the protected list. However, their Lordships had a short debate and put all three birds on the protected list.

In Committee my hon. Friend the Member for Harborough (Mr. Farr) moved an amendment to replace the three birds on the quarry list. In reply to an interesting debate, I proposed that, because the godwit breeds outwith our shores and therefore we have no control over the conservation of breeding grounds, we should follow their Lordships' wish, but that, for the reasons which I have given in my speech and in Committee, the redshank and curlew should return to the quarry list. That was accepted by the Committee and there was no vote. That issue was not debated on Report in this House. Surely the rights of the House of Commons should be given as much consideration as the rights of another place. I agree with my hon. Friend the Member for Gainsborough about that.

After the Bill left the House and returned to another place, their Lordships put down amendment to place the two birds in question—let us not forget that the godwit is not part of that deliberation—on the protected list. I regret that the arguments were ones of sentiment and not of conservation. I agree with him that all birds are attractive to look at. It is no use saying that the godwit is more attractive than, for example, the cock pheasant, the partridge, or the blackcock or many other birds which are on the game or quarry list. Therefore, it was right that their Lordships stuck to conservation reasons alone and did not change their tack to reasons of sentiment, as they did in earlier debates. The removal of the godwit was significant because the majority, which in the first instance was 51, was reduced to 19, in a House numbering only 105.

The Wildfowlers Association of Great Britain and Ireland—now the British Association for Shooting and Conservation—and the British Field Sports Society feel that they have been let down, because the view of the House of Commons has not prevailed. As I said, we are in an impossible position. If we ask the other place whether it really wishes to persist with the amendment, the Bill will be placed in jeopardy, and I am the last person to wish that to happen.

6 pm

In considering this important Bill I set out with the principle that we should improve conservation and protection. For field sports that principle was that conservation must be all important. At this final stage, the principle that I set out to achieve has gone by the board. Therefore, the words that I have from time to time uttered on this subject will not be fulfilled in their entirety. Because of the timing and the practicalities involved, I must make clear my view on how this issue has been handled in the other place. The measure was always supported by my noble Friend Lord Avon, but, regrettably, it was lost in the other place.

If further protection measures are introduced—and they will be as evolution in bird protection proceeds—I hope that we shall always bear in mind that principles are as important as other mechanical means of obtaining protection, such as those of the Division Lobbies. I am sad about this one aspect of the Bill, but in other respects I am more than delighted that the tremendous step forward represented by the Bill—and supported by Europe and Britain—will be enacted tomorrow. It will immensely enhance conservation and protection in Great Britain.

Mr. John Farr (Harborough):: Mr. John Farr (Harborough): I add my congratulations to those given to my hon. Friend the Member for Dumfries (Sir H. Monro), which have been echoed on both sides of the Chamber. We are pleased to have the benefit of my hon. Friend's advice. As we learnt in Committee, his advice is usually full of good, sound, common sense.

I agree with the criticisms levied by my hon. Friend the Member for Gainsborough (Sir M. Kimball), and to a lesser extent by my hon. Friend the Member for Dumfries, who, naturally, chose his words carefully. The House is in an invidious position. As Opposition Members have said, there are many important matters before the country, and that makes one wonder how many members of the public would regard it as right to be discussing this

measure. In addition to the threatened strike at British Leyland and the IRA bombs, there are many other important matters to discuss.

The last straw is that the House is not only discussing such relatively trivial matters, but cannot reject the provision because the other place is not sitting. That is intolerable. I cannot understand how the other place can engage in such brinkmanship on a Bill of such magnitude and importance. The Bill has been carefully prepared and thought out. For years before its introduction consultations were carried out with all the different bodies and a consensus was reached. I cannot understand how, at this late stage, the other place can be so rash and foolhardy as to prejudice the whole Bill. It is doing so for the sake of 18 or 20 amendments, none of which—with the exception of this amendment—is of any consequence.

For purely sentimental reasons the amendment seeks to pursue something that the House, in a democratic way in Committee, considered and rejected. No hon. Member can disagree with the analysis that my hon. Friend the Member for Gainsborough put forward when he said that we had no alternative but to accept the amendments. The Bill is a credit to the Government and, in particular, to the careful way in which Ministers have listened to various opinions. The Bill is a monument to their achievement. No sensible Conservative Member could do anything but reluctantly accept the Lords amendments.

Mention has been made of the careful consultations carried out. We are playing for big stakes tonight, and whether the bird is a curlew or a redshank does not matter. Indeed, it is all the same whether the bird is a bar-tailed godwit or a dodo. We are playing for big stakes, because many people, particularly in the other place, believe that monumental progress has been made on the protection of sites of special scientific interest and moorlands and on the protection of plants by the new laws that have been introduced on wild and captive birds. The new marine nature reserves are inspiring. The Bill contains important provisions on public rights of way, with all that they entail. It is unthinkable that the Bill should be imperiled simply for the sake of a couple of minor species, such as the curlew and the redshank.

According to its manifesto it is part of the Labour Party's official policy that hunting, coursing and shooting for sport should be banned. The Bill is part of that battle, and the sooner that is recognised, the better.

In Committee and in the other place vigorous discussion took place. Labour Members launched several attacks on all forms of shooting. They sought to ban certain forms of wildfowling, to limit the woodcock shooting season, to reduce the snipe shooting season, to ban night-time shooting and, as I have said, to ban the Sunday shooting of wildfowl. In Committee we carefully considered the evidence relating to the population count of the curlew and the redshank.

My hon. Friend the Member for Dumfries referred to a governmental committee. Until recently he had the benefit of its advice, and, as he said, it advises the Government of the day of danger levels among the various species. The committee was originally a Home Office committee, but it was transferred to the Department of the Environment. It was originally known as the advisory committee on the protection of birds for England and Wales. When the committee was under the Home Office,


there was a separate committee for Scotland. The committee is now called the Nature Conservancy Council advisory committee for Great Britain.

The committee considered whether there was a risk to the redshank and curlew. It was confirmed to me today by members of that committee that the conclusion was reached that on conservation grounds there was no need for protection. Those birds are adequately represented in population numbers. Surely that evidence must guide a sensible politician. We were guided by similar evidence in Committee. There was considerable discussion of the matter and figures were given of population numbers. Give or take a little, the analysis of population counts for the curlew and redshank are almost exact. Both birds are prolific breeders, both breed in Britain, and their wintering numbers are numerous.

What will happen if, after having been shot for many years—only a small cull is taken annually by wildfowlers on our foreshores—these birds are not culled? There is a real risk that some of the scarcer waders will have difficulty in maintaining their population levels. If the curlew and redshank are allowed to continue breeding unmolested—they are big, strong and aggressive birds—some of the smaller waders that are not numerous, such as the avocet in Suffolk, could find their existence at risk, because the total area of feeding grounds is limited and the total population of all waders that can be carried on those feeding grounds is limited. If these two birds are protected, the balance on our foreshores, as we know it today, could be endangered.

In Britain today about 2 million people enjoy the recreation of shooting, in one form or another. It is estimated that about 100,000 people gain a living thereby, directly or indirectly, either in arms and ammunition manufacture or in maintaining and keepering woods, fields and plantations. They carefully conserve and protect the remoter—some not so remote—parts of the country and keep them quiet for breeding purposes. In addition, the sport of shooting is a big foreign currency earner. These birds will continue to flourish only if quarry which is in abundance is harvested or shot during the open season.

There is nothing that hon. Members can do today but squeal and wriggle, because we cannot reject the amendments. We cannot imperil the progress of the Bill by insisting on our right to eradicate the amendments. If we follow the reckless attitude of the other place, we shall have much to answer for. When the Bill is enacted, even with these flaws, it will prove to be an edifice and a monument to the caring attitude of the Conservative Government towards our countryside.

Mr. Macfarlane:: Mr. Macfarlane: I am grateful to the hon. Member for West Lothian (Mr. Dalyell) and to my hon. Friends for their comments on the amendments. I know that there are deeply held convictions on both sides of the House and it is difficult to sum up effectively because those views and opinions have been deeply held for a long time.

Strange alliances are often struck in this establishment, and one of the more endearing memories that I shall have of this dying Session is that the views of my hon. Friend the Member for Gainsborough (Sir M. Kimball) seem to have a certain similarity with those of the would-be aspirant for the deputy leadership of the Labour Party, the right hon. Member for Bristol, South-East (Mr. Benn), in his revulsion of the House of Lords, which I do not wholly accept. We must remember that this legislation started in

the House of Lords and thus has occupied a great part of this Session. Views and arguments have passed to and fro between the Houses, and we and the country have every reason to be grateful for the great knowledge that hon. Members have brought to bear on the subject. I respect their views.

I am also glad that my hon. Friend the Member for Dumfries (Sir H. Monro), formerly the Under-Secretary of State for the Environment, who saw the Bill through most of its stages, alluded to the rights of the House of Commons. When legislation starts in another place, it is always difficult to know which House sees it as its Bill. My hon. Friends the Members for Gainsborough and Harborough (Mr. Farr) acknowledged that time is not on their side and that we have to bow to the two votes in another place, when well in excess of 100 peers were present on both sides, even though only between six and 12 took part in the debate.

Mr. Dalyell:: Mr. Dalyell: I shall treasure many memories of the passage of the Bill, among them being the virulent attack on Members of the other place by the hon. Member for Gainsborough (Sir M. Kimball). If there were ever a proposition to do certain things to the other place, I should be extremely fascinated to see how the hon. Gentleman would vote.

That is a light-hearted note on which to end what has been a very long journey for many of us. I repeat that our interest does not stop here. We shall be monitoring point by point the Department of the Environment, the Ministry of Agriculture and the Treasury.

Question put and agreed to.

The Lords agree to the following amendment made by the Commons:

Orders of the Day — Schedule 7

Orders of the Day — AMENDMENTS OF THE DEER ACT 1963, THE CONSERVATION OF SEALS ACT 1970 AND THE BADGERS ACT 1973

In page 62, leave out lines 4 to 6 and insert—

The Ground Game Act 1880

—(1) Notwithstanding the provisions of section 6 of the Ground Game Act 1880, it shall not be unlawful for the occupier of any land himself, or one other person authorised by him under section 1 of that Act, to use firearms for the purpose of killing ground game thereon between the expiration of the first hour after sunset and the commencement of the last hour before sunrise if (except where he has the exclusive right) the occupier has written authority of the other person or one of the other persons entitled to kill and take the ground game on the land.

(2) In this paragraph "ground game" means hares and rabbits.

The Agriculture (Scotland) Act 1948

—(1) Notwithstanding the provisions of section 50(1)(a) of the Agriculture (Scotland) Act 1948, it shall not be unlawful for the owners of the shooting rights on any land or any person holding those rights from him, or the occupier of any land (who may in writing nominate one other person), to use a firearm for the purpose of killing ground game thereon between the expiration of the first hour after sunset and the commencement of the last hour before sunrise, if (except where he has the exclusive right) he has written authority of the other person or one of the other persons entitled to kill and take the ground game on the land.

(2) In this paragraph "ground game" means hares and rabbits.

The Dogs (Protection of Livestock) Act 1953

—(1) At the end of subsection (2) of section 1 of the Dogs (Protection of Livestock) Act 1953 (penalty where dog worries livestock on agricultural land) there shall be inserted the words "or

(c) being at large (that is to say not on a lead or otherwise under close control) in a field or enclosure in which there are sheep".

(2) After that subsection there shall be inserted the following subsection—

"(2A) Subsection (2)(c) of this section shall not apply in relation to—

a dog owned by, or in the charge of, the occupier of the field or enclosure or the owner of the sheep or a person authorised by either of those persons; or
 a police dog, a guide dog, a trained sheep dog, a working gun dog or a pack of hounds."

but propose the following amendment thereto: No. 23, in line 17, after "or" insert:

"(subject to sub-paragraph (2;) below)"

Mr. Macfarlane:: Mr. Macfarlane: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker:: Mr. Deputy Speaker: With this we may take Lords amendments Nos. 24 and 25.

Mr. Macfarlane:: Mr. Macfarlane: These amendments give effect to the intention of this House, when amendments concerning ground game were agreed on Report, that the law should be the same in Scotland as in England and Wales. The Lords amendments ensure that in Scotland, as in England and Wales, agricultural tenants will be entitled to delegate the right to shoot ground game at night only to one person, who must be an employee or a member of the household.

The amendments also remove an unintended effect of the provisions that this House accepted on Report whereby an owner of shooting rights in Scotland would have been required to obtain the consent of any other owner of shooting rights to shoot ground game at night. The Lords amendments ensure that that constraint will apply only to agricultural tenants in order to protect rights over game.

Question put and agreed to.

Subsequent Lords amendments agreed to.

Orders of the Day — Betting and Gaming Duties Bill [ Lords]

Considered in Committee.

[Mr. BERNARD WEATHERILL in the Chair]

Clause 1

Orders of the Day — GENERAL BETTING DUTY

The Solicitor-General (Sir Ian Percival):: The Solicitor-General (Sir Ian Percival): I beg to move amendment No. 1, in page 2, line 2, leave out '71/2' and insert '8'.

The Bill and the others to which we shall come in a moment have passed through the other place and come thus far with a tranquillity and brevity that are perhaps the best reflection that there could be of the great confidence reposed by both Houses in the work of the Joint Select Committee, the Law Commission and the draftsmen. Some hon. Members will know that that tranquillity was momentarily broken last Friday morning, but, due to the presence of mind of the Patronage Secretary and the assistance of the House—particularly that of the right hon. and learned Member for Warley, West (Mr. Archer), to whom I offer my warm thanks—the tranquillity was quickly restored and our customary brevity was even improved upon.

As my right hon. Friend has clearly developed a feel for the presentation of consolidation Bills and managed to shorten the time taken to even less than that achieved by the rest of us, I had thought of inviting him to take charge of the remaining stages. I have not done so because I want to take this, my first, opportunity to echo what was said on Friday about the part played by the Commission, the Committee and the draftsmen.

I hope that my right hon. Friend the Chief Whip will receive the message, in which I am sure the right hon. and learned Gentleman will join me, that if he should feel a wish to intervene in these proceedings later this evening the Committee would be agreeably disposed to hearing more of the eloquence that he displayed last Friday, which can be read in Hansard, at column 13, lines 33 to 38.

The Chairman:: The Chairman: Order. I am sorry to interrupt the Solicitor-General, but we are discussing an amendment. This is not a general debate, and I hope that no one will feel tempted to indulge in one.

The Solicitor-General:: The Solicitor-General: You have beaten me by a second, Mr. Weatherill. I was about to say "I turn to the first amendment". I hope that you will not rule me out of order if on this amendment I say something that is common to all the others, because it will save me repeating it.

Most of the amendments are necessary because the Finance Act 1981 altered some of the provisions that are consolidated in this Bill. If any hon. Member wishes me to give information on any of the amendments, I shall be happy to do so. In the absence of any indication to that effect, I shall simply move the amendments formally.

Mr. Peter Archer (Warley, West):: Mr. Peter Archer (Warley, West): I am grateful to the Solicitor-General for his kind comments. There is nothing between the two sides of the House on the matter of law reform. We are all anxious to expedite the passage of the Bill. If I say no more, I hope that that will be interpreted simply as a desire to expedite its passage.

Question put and agreed to.

Clause 1, as amended, ordered to stand part of the Bill.

Clauses 2 to 16 ordered to stand part of the Bill.

Orders of the Day — Clause 17

Orders of the Day — BINGO DUTY

Amendments made: No. 2, in page 13, line 28, leave out '71/2' and insert '10'.

No. 3, in line 31, leave out 'three thirty-sevenths' and insert 'one-ninth'.

No. 4, in line 33, leave out '71/2' and insert '10' .—[The Solicitor-General.]

Clause 17, as amended, ordered to stand part of the Bill.

Clauses 18 to 22 ordered to stand part of the Bill.

Orders of the Day — Clause 23

Orders of the Day — AMOUNT OF DUTY

Amendments made: No. 5, in page 17. line 13, leave out '£20' and insert '£25'.

No. 6, in line 15, leave out '£.25' and insert '£60'.

No. 7, in line 16, leave out '£25 plus £100' and insert '£60 plus £120'.

No. 8, in page 17, leave out lines 19 to 27 and insert—

Description of machines authorised by the licence
Duty on whole-year licence


Chargeable at the lower rate.
£75 per machine.


Chargeable at the higer rate.
£200 per machine.


Chargeable at the peak rate.
£400 per machine.

—[The Solicitor-General.]

Clause 23, as amended, ordered to stand part of the Bill.

Clauses 24 to 34 ordered to stand part of the Bill.

Orders of the Day — Clause 35

Orders of the Day — SHORT TITLE, CONSTRUCTION, COMMENCEMENT AND EXTENT

Amendment made: No. 9, in page 25, line 32, leave out subsection (3).—[The Solicitor-General.]

Clause 35, as amended, ordered to stand part of the Bill.

Schedules 1 to 6 agreed to.

Orders of the Day — Schedule 7

Orders of the Day — REPEALS

Amendments made: No. 10, in page 56, line 19, leave out 'Section 2' and insert 'Section 2(2)'.

No. 11, in line 29, leave out '7(1) and 8' and insert 'and 7(1)'.

No. 12, in line 32, leave out 'Section 9' and insert

'In section 9, in subsection (1) the words from "section 1(2) (b)" to "and", subsections (2), (3), (4), (5), (7) and in subsection (8) the words from "Subsections (2)" to "subsections (5)".'—[The Solicitor-General.]

Schedule 7, as amended, agreed to.

Bill reported, with amendments; as amended, considered.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, with amendments.

Orders of the Day — Acquisition of Land Bill [Lords]

Considered in Committee

[MR. BRYANT GODMAN IRVINE in the Chair] Clauses 1 to 6 ordered to stand part of the Bill.

Clause 7

Orders of the Day — INTERPRETATION

The Solicitor-General (Sir Ian Percival):: The Solicitor-General (Sir Ian Percival): I beg to move amendment No. 1, in page 4, line 30, leave out 'county'.

The First Deputy Chairman:: The First Deputy Chairman: With this we may take Government amendment No. 2.

The Solicitor-General:: The Solicitor-General: Both amendments are of a technical nature. Their purpose is further to ensure that the Bill properly expresses the existing law. I believe that they do so and I therefore commend them to the Committee.

Question put and agreed to.

Amendment made: No. 2, in page 5, line 9, at end insert 'by statutory instrument' .—[The Solicitor-General.]

Clause 7, as amended, ordered to stand part of the Bill.

Clauses 8 to 35 ordered to stand part of the Bill.

Schedules 1 to 6 agreed to.

Bill reported, with amendments; as amended, considered.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, with amendments.

Orders of the Day — New Towns Bill [Lords]

Considered in Committee.

[MR. BRYANT GODMAN IRVINE in the Chair] Clauses 1 to 82 ordered to stand part of the Bill. Schedules 1 to 10 agreed to.

Orders of the Day — Schedule 11

Orders of the Day — SAVING AND TRANSITIONAL PROVISIONS

The Solicitor-General (Sir Ian Percival):: The Solicitor-General (Sir Ian Percival): I beg to move amendment No. 1, in page 97, line 31, leave out from beginning to end of line 9 on page 98.

The amendment removes from the Bill a provision made unnecessary because of the appointment of a day under the British Telecommunications Act 1981 for the transfer of functions of the Post Office as to telecommunications and data processing to British Telecommunications.

Question put and agreed to.

Schedule 11, as amended, agreed to.

Orders of the Day — Schedule 12

Orders of the Day — CONSEQUENTIAL AMENDMENTS

Amendment made: No. 2, in page 99, line 28, at end insert:

'Housing Act 1974 c. 44

13. In the Housing Act 1974—

in section 5(3)(d),
 in section 84, and
 in section 99(2)(e),

for "New Towns Act 1965" substitute "New Towns Act 1981". ' .—[The Solicitor-General.]

Schedule 12, as amended, agreed to.

Schedule 13 agreed to.

Bill reported, with amendments; as amended, considered.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, with amendments.

Orders of the Day — Northern Ireland (Magistrates' Courts)

Mr. Deputy Speaker (Mr. Bryant Godman Irvine):: Mr. Deputy Speaker (Mr. Bryant Godman Irvine): I call Mr. Humphrey Atkins to speak on the Northern Ireland order.

The Solicitor General (Sir Ian Percival):: The Solicitor General (Sir Ian Percival): I beg to move,

That the draft Magistrates' Courts (Northern Ireland) Order 1981, which was laid before this House on 9th July, be approved.

The order consolidates the law of Northern Ireland relating to practice and procedure before magistrates' courts. The extent of the repeals of existing enactments contained in schedule 7 to the Bill demonstrates the value of the measure in gathering all of those provisions into one consolidated measure. Therefore, I am sure that it will be welcomed by all.

The Joint Committee reported on 15 July that it had considered the draft, and was satisfied that it was pure consolidation and there was no point to which the attention of Parliament should be drawn. I know of no other point to which I should draw the attention of the House.

Question put and agreed to.

Orders of the Day — European Community (Mandate)

The Lord Privy Seal (Mr. Humphrey Atkins):: The Lord Privy Seal (Mr. Humphrey Atkins): I beg to move,

That this House takes note of the Report of the European Commission on the Mandate of 30th May 1980 (COM (81) (300)) and fully supports Her Majesty's Government in their determination to negotiate a satisfactory solution to the problems of budgetary contributions, to achieve reforms of the Common Agricultural Policy and to give an impetus to the development of Community policies.

I understand, Mr. Deputy Speaker, why you may have wished to call me on the previous order relating to Northern Ireland, but it is more than 10 years since I made a speech in the House about the European Comunity. . I do not know how many right hon and hon. Members in their places now were present on that occasion—I believe not many. In my previous job in Northern Ireland there was not much call to talk about the European Community, and in the job before that I was not allowed to make speeches at all.

It is appropriate that I should start by reaffirming in the strongest terms both my and the Government's commitment to the Community. The British people made a wise decision six years ago when they voted in the referendum by a majority of two to one to remain in the Community. Community membership offers Britain the best and, indeed, the only satisfactory basis on which to build our future prosperity and economic strength.

Our trade with the Community has reached a point where it takes 43 per cent. of our exports—60 per cent. if we include the European associates to whose markets we also enjoy tariff-free access. There has been a steady increase in industrial investment in Britain by American, Japanese and other overseas firms which, to a considerable extent, are attracted here by the fact that we are part of a free market of 270 million people. That investment, as we all know, means a great deal in terms of new jobs and new activity, most of it fortunately coming to the areas where it is most badly needed.

The Community has given us greater weight in international economic negotiations. That last point has recently been vividly illustrated by the new consensus on minimum export credit rates, which should produce significant savings for the British taxpayer and which was reached largely as a result of pressure on Japan by the European Community and the United States acting in concert.

Our belief in the Community doe not blind us to the defects that still remain in the way in which it works. On the contrary, it stengthens our determination to stick with our partners' ways of making it work better.

The report that we are debating was produced by the Commission in pursuance of the mandate given to it in the agreement of 30 May 1980. That agreement among the Heads of Government of all the member States provided for substantial refunds of the United Kingdom's net budgetary contributions over the succeeding two, or possibly three, years, and went on to state that a structural solution designed to prevent the recurrence of any unacceptable situation would be decided by the end of 1981. Since I had nothing to do with the negotiations, I cannot be accused of immodesty when I say that the agreement was a significant step forward for Britain and the Community as whole.

When we took office we inherited an intolerable situation. Unless some action had been taken, Britain, a country below the Community average level of prosperity, would have had to pay a net contribution of about £1,000 million a year into the Community. The Government changed that, thanks in no small part to the determination and negotiatiating skill of my right hon. Friend the Prime Minister.

As a result, we have already received about £675 million as refunds of our net contribution for 1980. We shall receive the balance of the refunds due in respect of 1980 when the final calculations of our net contribution for that year are made.

Mr. Tony Marlow (Northampton, North):: Mr. Tony Marlow (Northampton, North): I apologise for intervening so early in my right hon. Friend's speech, but an important calculation must be made if we pay the money one year and get it back a year or a year and a bit later. If there is money in the bank it earns interst, but if one has to borrow it one pays interest. Can my right hon. Friend at some stage calculate how much the delay in getting the money back has cost us, and therefore by how much the amount that we receive back has been reduced by the interest payments that we have had to make in the meantime?

Mr. Atkins:: Mr. Atkins: I could not do the mathematical calculation on my feet at the Dispatch Box, although it can be done. However, my point is that had we done nothing at all we should be paying £1,000 million a year, but as a result of the discussions in May 1980 we have got back £675 million, and we shall get more for the year 1980. If my hon. Friend will allow me, I propose to come to what we propose to do to replace that admittedly unsatisfactory arrangement, whereby we are out of the money for some time, with something better.

I have spoken about 1980. We shall shortly be getting the first refunds in respect of 1981. The May 1980 agreement made a major reduction in our net contribution over those two years. As I said earlier, there is provision for a similar arrangement to apply to 1982 if necessary.

However, it was only a temporary solution to a continuing problem. The 30 May agreement also pledged the Community to resolve the problem on a longer-term basis by means of structural changes. That was an important decision. It was agreed that the problem should be tackled through an examination of the development of all Community policies, including the common agricultural policy, with the aim of preventing the recurrence of unacceptable situations for any member State. The report before us gives the Commission's proposals on how that may be done.

The report deals with the problem in three sections—the development of policies other than agricultural, the reform of the CAP and the problem of unacceptable net budgetary contributions. In the first section the Commission sets the problem within the broad context of Community development in the medium term and the need for the Community to meet the challenge of the 1980s. It calls for progress in a number of areas, including completion of the internal market, energy policy, development of the European monetary system and research and development. It recommends that the resources of the regional and social funds should be increased and concentrated on areas of particular need, in

particular, that the regional fund should concentrate on areas suffering from underdevelopment as well as the problems of industrial decline. At the same time it says that the social fund should give more emphasis to current problems, particularly in regions where traditional industries are concentrated, and to preparing young people for working life.

On the common agricultural policy, the Commission, although endorsing the basic principles of the policy, concludes that, since the Community is now more than self-sufficient for most agricultural products, sound management and the need to keep costs under control require that adjustments should be made to the way in which it operates in future. It recommends a number of guidelines, which include the following five: first, a price policy based on a narrowing of the gap between Community prices and prices applied by its main competitors; secondly, a limitation of the open-ended price guarantee, so that if Community production exceeds certain thresholds the full Community price will not be paid; thirdly, the possibility of direct income support subsidies to certain producers in specific circumstances; fourthly, an active export policy which would honour the Community's international commitments; and, fifthly, stricter discipline over national aids to agriculture.

It is the Commission's view that, if these guidelines are implemented, the Community's agricultural expenditure should grow more slowly than its financial resources, and that, of course, means that what we consider to be the excessive proportion of Community expenditure devoted to agriculture would be gradually reduced.

Finally, in the third section dealing with the budget itself the Commission recognises that the United Kingdom continues to face an inequitable budget situation, mainly because it obtains a much smaller relative return from the CAP than do the other member States. It recommends that there should be a corrective mechanism based on the difference between the United Kingdom's share of Community gross national product and the proportion it obtains of FEOGA guarantee expenditure. It suggests that the corrective should be temporary, but should last until the development of other Community policies makes itself felt.

Mr. Marlow:: Mr. Marlow: I am terribly sorry to intervene again. My right hon. Friend talks about radical ideas for reform of the CAP. Reforms have been required and requested and plans put forward for years, going back to the Mansholt plan, which must be about 10 years old. Can my right hon. Friend really give us hope that this time changes will take place? What is the difference now that will make changes take place? If we do not get the changes within a limited time, will the Government take action unilaterally to support the consumer in the United Kingdom, who has been milked for so long by this wretched policy?

Mr. Atkins:: Mr. Atkins: The difference is that the Heads of Government on 30 May recognised the existence of the problem, instructed that work should be done to see how it could be resolved and told the Commission to produce ideas, and the Commission, for the first time that I know of, has produced them. Those are the ideas that I have outlined. I was about to comment on them. I have so far briefly put what the Commission, in pursuance of the mandate, produced as ideas about what should be done. That is a new departure.

I should now like to make a number of detailed comments on the Commission's report. In general, although we believe that in some respects the report does not go far enough in the solutions that it puts forward and the approach to solving the budgetary problem is too narrowly based, we none the less regard it as a step in the right direction.

The European Council at the end of June this year agreed on the procedure for handling the report. It called for work to be done so that conclusions could be reached by the Heads of Government at the next meeting of the European Council in London on 26 and 27 November. It is a major priority of our Presidency to ensure that we make decisive progress on the subject.

Mr. Julius Silverman (Birmingham, Erdington):: Mr. Julius Silverman (Birmingham, Erdington): As many of the proposals are not comprehensible and none is specific, how can the Council of Ministers on 26 November reach a definite conclusion on the document?

Mr. Atkins:: Mr. Atkins: I repeat again that we are discussing tonight the Commission's ideas produced in June on how the mandate given on 30 May 1980 might be fulfilled. In June, when the Heads of Government met in the European Council again, they called on member countries to sit down, discuss, negotiate and work out how best to solve the problem, whether by adopting the proposals or in some other way, and present Heads of Government with decisions for them to endorse, or, if decisions were not possible, at least alternatives to discuss and decide on. That is what is happening. Discussions have gone on steadily and intensively over the past weeks and months.

I am glad to say that at the Foreign Affairs Council that I attended earlier in the week all member States represented recognised the need to accelerate the work, because 26 November is not far away. To facilitate decisions at the November meeting we are under instructions from our Heads of Government to do just that. It is accepted by all the countries that it is necessary to arrive in November at a position where the Council can take decisions.

As I say, the negotiations have been and still are going on. The House will agree that it would not help our case to give details of the Government's negotiating hand tonight. However, I wish to explain how the Government view the main problems and how we hope to see the discussions develop.

It has been agreed in the Community that discussions should be carried forward on a broad front, encompassing all three elements in the Commission's report. They are in fact closely connected. It is recognised that what is needed now is a general revitalisation of the Community and that our decisions should be taken in the context of an overall strategy to that end. My right hon. and noble Friend the Foreign Secretary has indeed been calling for this for some time. We wish this to apply to areas where no expenditure is required, such as the completion of the common market and the creation of common rules for the service industries, such as insurance, as well as to the Community's regional and social funds, whose expansion we have consistently supported and whose operation we feel should be focused more precisely on the main areas of need. It is welcome news that certain other countries, most recently the new French Government, have now made similar calls for the renewal of the Community through the development of its policies in these fields.

In parallel, there will have to be genuine reforms in the CAP. A great deal of nonsense is talked about the CAP in Britain, It has become one of the "Aunt Sallies" of our time. Clearly, it would be ludicrous to "jettison" the CAP, as the Opposition amendment suggests. The CAP is a working system, imperfect but capable of improvement. All the Opposition have to offer is a hope and a prayer. They say "the British consumer would be free to buy food at the lowest prices". Where would we find the quantities that we would need at these "lowest prices"? Do they think the British consumer would have welcomed the opportunity to buy sugar at "lowest 'world prices" last year, when these were about £400 per tonne, compared with a Community price of £300 per tonne? Perhaps they do and will tell us.

Mr. Denzil Davies (Llanelli):: Mr. Denzil Davies (Llanelli): The right hon. Gentleman is misreading the amendment. The amendment does not say "lowest world prices". It specifically says "lowest prices". In any world market there is a lowest price.

Mr. Atkins:: Mr. Atkins: It is interesting to hear the Opposition's sudden interest in low prices. Under the Labour Administration, agricultural expenditure in the Community increased by an average of over 20 per cent. a year. Since the Conservative Party took office that figure has been 51/2 per cent.

Mrs. Elaine Kellett-Bowman (Lancaster):: Mrs. Elaine Kellett-Bowman (Lancaster): My right hon. Friend referred to the Community's regional and social funds. He said that they should be focused more on the areas in need. Will my right hon. Friend acknowledge that this is the first time that we have succeeded in persuading anybody to include in any Community document areas in industrial decline? They are of paramount importance to this country.

Mr. Atkins:: Mr. Atkins: My hon. Friend knows better than I whether it is the first time. That is a very important thing to do.

Although the CAP policy is not perfect and needs improvement, our level of agricultural self-sufficiency has increased. Food prices have risen more slowly than the general rate of inflation. The "intervention stocks" that we hear so much about are in most cases down now to a few days' supply. I cannot understand how the Opposition's policy would do the Opposition's farmers, their dependent industries or our balance of payments any good.

It is encouraging that the need for reform of the common agricultural policy is also generally recognised in the Community. That is a major step forward.

Mr. Silverman:: Mr. Silverman: Does not the mandate specifically exclude basic reform of the common agricultural policy?

Mr. Atkins:: Mr. Atkins: No, it does not. The hon. Gentleman should spend a moment or two reading the document. If he did so he would be able to make a useful contribution to the debate. Our aim is to make the most of this generally recognised need for reform and to work for serious and practical changes designed to lead to reductions in the Community's surpluses. That would therefore affect the common agricultural policy's share of expenditure.

A central element in this must be a policy for agricultural price restraint on the lines proposed by the Commission. There will also have to be limitation of guarantees once certain production thresholds are passed. Measures of this sort should, however, not discriminate


between producers so as to penalise efficiency. We are against further recourse to general or linear co-responsibility levies of the sort that have been tried in recent years.

We also support the Commission's proposals for stricter control of national aids. They serve to distort the common market in agricultural produce. We are, however, cautious about the Commission's proposals for a more active export policy if these mean that the practice of exporting at heavy subsidy will be expanded. The Community must be careful of its obligations to its main trading partners, whether developed or developing. The overall objective must be to establish effective financial control over the CAP and reduce costs so that resources can be released within the 1 per cent. VAT ceiling for the other policies that the Community badly needs.

The changes that I have outlined should make some contribution in due course to reducing the extent of our problem over the Community budget. Therefore, they will take time to bring about and their effect in the short term can only be small. This is why we endorse the Commission's conclusion that, in addition, corrective measures are needed to deal with the budgetary problem.

We welcome the Commission's recognition that the United Kingdom is in an inequitable situation which must be corrected and the fact that it has proposed one way in which the correction could be made. However, we see this as a problem not just for the United Kingdom. The net contributions and receipts of all member States come about haphazardly as a result of separate decisions by different Councils on individual policies. No attempt is made at present to decide the overall pattern of the budget outcome. No member State would dream of proceeding this way at home. Any member State could in theory find itself in an unacceptable situation.

It would be nonsense to find, for example, that after its accession Portugal, with a GNP of about half the Community average, was a net contributor. In practice, not only we but the German Government are saying that our net contribution is excessive and should not be openended.

We have suggested that the right approach should be for the net contributions and receipts of all member States to be decided by the Community on the basis of objective criteria such as relative prosperity and population size. That we have to find an answer to this is clear. If the financial basis of the Community is acceptable to all, there will be much greater willingness to develop new and useful policies.

Despite some speculative claims from Labour Members, the Commission's ideas are couched in general terms and it is simply not possible to make precise estimates of what its results would be for the United Kingdom. A great deal depends on the detailed implementation of any scheme, whether the Commission's or another. That is a key part of the negotiation.

Mr. Marlow:: Mr. Marlow: I am sorry to interrupt again. My right hon. Friend has been more than kind so far. When we are talking about our net contribution, will my right hon. Friend, when he is looking at it and putting it to the Community, remember that not only are we making a net contribution to the budget, but that, by and large, over the years we shall be forced to buy—if the common

agricultural policy stays roughly as it is or under any conceivable CAP—some of our food from Europe? We would otherwise be able to buy that food on the world market—often at lower prices. The present policy is a real additional burden on the United Kingdom housewife and community, It is just the same as a budget contribution, but additional to it. When we are looking at the amount spent on the Community they must in fairness be added together.

Mr. Atkins:: Mr. Atkins: When considering the balance sheet of the advantage and disadvantage to the United Kingdom of belonging to the Community, one has to take into account factors other than the budgetary outcome alone. Many factors can be brought into the balance sheet, but I was talking only about the budget, while focusing on the fact that our budgetary contribution was unacceptable and had to be put right and suggesting that, although we are glad that the Commission has made one suggestion about how that might be done, we believe that it can be done better and more fairly in a different way. We have been negotiating with our Community partners and we have every intention of carrying the negotiations through to a successful conclusion.

We achieved a firm Community pledge in the 30 May agreement to resolve the problem. We have a Commission report which provides a useful starting point. We have a shared interest with our partners in the Community in further developing a number of policies which we ourselves support, in eliminating the wastefulness of some aspects of the CAP and in preventing the recurrence of unacceptable budgetary situations. These are all major elements in our favour, and we shall build on them. The Government utterly reject the defeatism of most of those on the Labour Benches.

Even when in Government, the Labour Party's record of determination to secure improvements in the Community was less than impressive, Labour's famous "renegotiation" never yielded a single penny in refunds of our net contribution, and yet, without regard to the substantial achievements that the Government have made, the Opposition are saying that it is all too difficult and suddenly, apparently, the Community is incompatible with the pursuit of true Socialism—a view which is rejected by all their Socialist colleagues in Europe.

The national executive committee of the Labour Party and the TUC are now, I gather, embarking on an analysis of the economic and political consequences of withdrawal from the Community. Personally, I should have made the analysis before announcing the policy—but so be it. I shall be interested in the results. I hope, however, that when we emerge from the current negotiations Labour Members will look honestly at their policies on the Community. But I would much rather that they backed the true British interest, which is to secure a better Community which works more effectively to the benefit of its citizens.

Let me sum up. We are determined to achieve a satisfactory solution to the problem of budgetary contributions, a reform of the CAP and the development of other policies leading to a better balance in Community expenditure. Membership of the Community is the essential framework within which we have to increase the economic strength and prosperity of our country. I therefore hope that all hon. Members will support the Government's efforts to bring that about.

Mr. Denzil Davies (Llanelli):: Mr. Denzil Davies (Llanelli): I beg to move, to leave out from 'House' to the end of the Question and to add instead thereof:

"notes that the proposals contained in the Commission Document (COM (81) (300) of 22nd June 1981 in respect of the Mandate of 30th May 1980 are totally inadequate to remove the heavy burden imposed upon the economy of the United Kingdom by the Common Agricultural Policy and the budgetary arrangements of the Community; further notes that that burden can only be removed by jettisoning the antiquated mechanisms of the Common Agricultural Policy so that the British consumer is free to buy food at the lowest prices; and urges Her Majesty's Government to reject any new arrangements which fail to ensure that the United Kingdom's contributions to the Community Budget do not exceed its receipts."

I add my welcome to the Lord Privy Seal following his move from the rigours of Northern Ireland to the calmer waters of the Foreign Office. His Minister of State told us on Monday that Foreign Office Ministers never panic. I am sure that if the right hon. Gentleman has the good sense to throw out of the window the collected works of John Maynard Keynes, which his predecessor kept in his room, and to indent for the collected works of Milton Friedman he will have no need to panic.

As the right hon. Gentleman told the House, our debate concerns the mandate which arises from the famous temporary compromise of 30 May last year on Britain's budgetary contribution. The Government have tabled a motion in suitably vague terms and the Opposition have moved a precise amendment. The document is utterly inadequate to solve the problem and we heard nothing from the Lord Privy Seal to suggest otherwise. The best that he could muster, with all the authority of the Foreign Office, was that it was a step in the right direction.

The document shows that the Commission does not have the will to present any radical proposals for change. In the immortal phrase of Ernest Bevin, most of the document is "Clitch after clitch after clitch". The best example of its vacuuity is paragraph 4:

"In this way the Community will finally take its rightful place in the world and become a catalyst for peace and development".

Considering that most of the senior officials who worked on that document are probably earning at least £40,000 a year tax free, one could have expected them to do better than to write that sort of rubbish.

The document is supposed to set out proposals for finding a permanent solution to the absurd situation of the United Kingdom always having paid far more money to the Community than it has received in return. However, out of 28 pages of what I charitably describe as prose, a mere two pages are specifically devoted to the United Kingdom's unacceptable situation. The paper takes 12 pages to get to the CAP and when it does it produces this dazzling sentence:
the result of twenty years of the application of the C.A.P. is positive.
We in Britain could rewrite that statement to read "The result of eight years of the application of the CAP is a positive disaster".

The Commission makes it clear that it has no intention of putting forward radical suggestions. It states candidly in paragraph 19:
It is neither possible nor desirable to jettison the mechanisms of the common agricultural policy".
We must have some sympathy with the Commission, because even if it wished to put forward radical policies—though I doubt whether it would, since it has a

vested interest in the bureacracy of the CAP—its hands are tied. The Lord Privy Seal glossed over the temporary compromise, but it is clear that the Commission is not allowed to produce radical policies. The damage was done in the compromise.

The House will remember what happened on that occasion. The Foreign Office and the Prime Minister accepted a compromise arrangement which we have always argued was damaging to Britain and which should never have been accepted in the form that it was. Let us consider that compromise. First, the Prime Minister accepted half a loaf, having said that she would not do that. She accepted a temporary amelioration for only two years, but in every debate in the House she and the Chancellor of the Exchequer had made it clear that the Government were looking for a permanent solution.

But perhaps even worse than those two aspects of the compromise was the acceptance that any proposal for change should not call into question the basic principles—these words are used clearly in the communiqué
and the compromise—of the common agricultural policy and of the budgetary arrangements. Once that pass has been sold, once that bargaining counter has been given up, there is no way in which we can possibly get any satisfactory solution of this problem in the interests of Britain. The common agricultural policy and the budgetary arrangements of the Common Market are inimical to the best interests of this country, because they were devised without this country in mind.

Mr. Humphrey Atkins:: Mr. Humphrey Atkins: Am I not right in thinking that this was the position following the renegotiation in which the right hon. Gentleman had a hand?

Mr. Davies:: Mr. Davies: Of course the right hon. Gentleman is right in thinking that, and we have never disguised it. The point that we are making—and I hope that the right hon. Gentleman will not try to make party points—[Interruption.] We are concerned here, as the right hon. Gentleman said in his splendid peroration, with the interests of Britain, and I should have thought that he would want to raise the level of the debate and to look at the interests of Britain in this matter. It is not in the interests of Britain to be a party to these arrangements.

Sir Anthony Meyer (Flint, West):: Sir Anthony Meyer (Flint, West): Since the right hon. Gentleman is contending that the common agricultural policy is a bad way of sustaining British agriculture, would he care to confirm that, after an examination by the Labour Party of the cost of reverting to a deficiency payment system, it was found that out of six sets of assumptions on which a deficiency payment system could be based the minimum cost was £400 million a year and the maximum cost was £1,700 million a year, and that all the other assumptions, apart from the one that I first mentioned, were substantially larger than the sum expended by Britain on the common agricultural policy?

Mr. Davies:: Mr. Davies: The hon. Gentleman, as usual, misses the point. The common agricultural policy is damaging to Britain in many ways, and no doubt we can debate the question of costs on the appropriate occasion. The point that I am making now is that it is not possible, once the basic principles are not challenged, to make the common agricultural policy beneficial either to British agriculture or to the British consumer.

The Financial Secretary to the Treasury (Mr. Nicholas Ridley):: The Financial Secretary to the Treasury (Mr. Nicholas Ridley): Why, then, did the right hon.


Gentleman remain in the Labour Government which commended to the House the common agricultural policy after their renegotiation in 1975?

Mr. Davies:: Mr. Davies: That is the kind of silly remark that we expect from the Financial Secretary. This is the second debate on Foreign Office matters at which a Treasury Minister has been present to keep an eye on the Foreign Office, and we are glad to see him taking part in the debate. My answer to his question is that I was not a member of the Government when that renegotiation took place.

The paper deals and the Lord Privy Seal has dealt with the common agricultural policy. The Commission says clearly that all it is doing is to set out some adjustments to the CAP. It has given up the chance of any radical reform. It is not allowed to have it. So we are talking about adjustments, which it describes as guidelines. These are extremely vague and the Lord Privy Seal glossed over them quickly in his speech. Since they are only guidelines, I do not see how Mr. Ertl, the German Minister of Agriculture, will be able to accept them, or, indeed, that fierce lady who has just become Minister of Agriculture in France, and who sometimes sounds more Gaullist than Mr. Chirac on these matters. I cannot see her accepting them either. Perhaps we can be told by the Financial Secretary how the Government see these so-called guidelines being put into practice.

One disturbing feature of the Commission's proposals is its desire, when it looks at the surpluses and the cost of the CAP, to extend the system of what is called co-responsibility to curb the milk surplus in the Community, and presumably also raise more money for the Commission, for in paragraph 24 the Commission report states:
For milk products, the Commission considers that the objective of controlling production can only be achieved if the principle of co-responsibility is extended.
Stripped of the Community doublespeak, that means, in effect, a kind of tax on milk products. The Lord Privy Seal has great experience in these matters and I put this question to him: why on earth should the British dairy industry and the British consumer have to suffer this levy on milk when there is no surplus of milk products in Britain?

The Lord Privy Seal mentioned the co-responsibility levy. I hope that we shall get a reassurance from the Government tonight that they will not agree to the ridiculous suggestion of a new co-responsibility levy for the ostensible purpose, apparently, of reducing the milk surplus. As a result of the co-responsibility levy, the consumers will have to pay more for their milk than they would otherwise have had to pay. It will also damage the dairy industry. It is wholly unnecessary to have such a policy.

The suggestion of a co-responsibility levy demonstrates the absurdity of the CAP system. It is not simply a common agricultural policy; it is also a tax gathering policy. The agricultural system is one of the three heads of the own resources system and we find agriculture being used to raise revenue. That in itself is an extraordinary and retrograde system, because decisions are taken about farm policy not intrinsically on their merits—the co-responsibility levy is a classic example—but in order to raise more money for the Commission to spend on various other projects.

It is clear that one of the main preoccupations of the Commission is to raise more money in order to further its plans. Paragraph 40 of the Commission document contains the extraordinarily arrogant statement:
The Commission cannot accept that an artificial ceiling be put on own resources".
In other words, the Common Market should be allowed to spend what it wants and the money must then be found to pay for it. That is what the Commission is saying: the real world must not be allowed to intrude upon the Commission's grandiose designs. That is how the Common Market has operated up to now. That is what has happened. Projects have been approved and money then has to be found for those projects. That is why the Common Market is now getting into a serious financial crisis.

Now that the 1 per cent. ceiling in VAT will probably be reached in a few years, depending on world prices, the Commission is desperate to raise more money, and that is one purpose of the document. I hope, therefore, that the Financial Secretary, who is one of the disciples of Mr. Milton Friedman, will make it absolutely clear tonight in his reply that the British Government will not in any circumstances agree either to a lifting of the ceiling of 1 per cent. or, indeed, to an abolition of that ceiling, and that the ceiling of 1 per cent. VAT contribution will stay in all circumstances. We know the Financial Secretary's puritan views on these matters, and I hope that we shall get that assurance from him.

The system of collecting tax through VAT is in itself damaging to Britain. It is damaging for many reasons, but mainly because it is a poll tax. It is not a progressive form of taxation. It is based on spending in the economy, without taking into account a country's gross national product. It is therefore damaging to us as it is and would be even more damaging to us if the limit were raised.

To some extent, the Commission has done everyone a favour by showing in the Commission document what little can be achieved by tinkering with the common agricultural policy. We believe that the only course now open is to start dismantling the CAP and to replace it with national aids to agriculture. I was sorry to hear the Lord Privy Seal endorsing the statement in the document that national aids to agriculture must be discouraged, because we believe that the best way to help British agriculture and the British consumer is gradually to replace the CAP and allow each country in Europe to support its own farmers according to its own traditions and its own agricultural industry. Why should the agricultural sectors of 10 Western European nations have to be fitted into the straitjacket of the common agricultural policy?

Mr. Anthony Nelson (Chichester):: Mr. Anthony Nelson (Chichester): Given the proportion of the Community budget that is expended on agriculture, should not the right hon. Gentleman come clean with the House? His proposals have precious little to do with aiding British farming or agriculture. They amount essentially to a wrecking policy to destroy the main mechanism of the Common Market.

Mr. Davies:: Mr. Davies: It is interesting that the hon. Gentleman referred to the "main mechanism of the Common Market". The real purpose of the CAP is not to aid farming or benefit the consumer. It is there because nothing else is there. If it were removed, what would be left of the bureaucratic centralised operation? I do not believe that the Western Alliance will crumble as a result of the demise of the CAP.

Mr. Hugh Dykes (Harrow, East):: Mr. Hugh Dykes (Harrow, East): The right hon. Gentleman has displayed on previous occasions his sure-footed grasp of EEC statistics. Last year he told us that 25 per cent. of the population of France was engaged in work on the land. I hope that he has now secured the right figure. Surely his argument points to the beneficial redistributive potential of EEC funds for Britain. If money is collected through agricultural levies and if we get money back for non-agricultural purposes because we have a small agricultural sector, that is redistribution that we should encourage and develop. Why is the right hon. Gentleman against that?

Mr. Davies:: Mr. Davies: Because we are not getting the money back. There is nothing in the document to suggest that we shall get it. One of our objections to the CAP is that it is the main reason why we have been making such large contributions to the budget. We are not receiving any compensatory refunds from the Common Market.

Before Conservative Members say that dismantling the CAP amounts to a Marxist plot dreamt up by the Left, Transport House and Walworth Road, I remind the House that the House of Lords Select Committee on European Communities—it does excellent work under the chairmanship of Baroness White over the complete range of Common Market policy—in its 29th report on the reform of the budget states:
The Committee"—
that is the Select Committee of the House of Lords—
has argued in this and previous reports that a solution is most likely to be found in increased national responsibility for agricultural expenditure.
The Committee considered the issues objectively and came to the same conclusion as the Opposition: that the only way in which the problem can be solved—that is the budgetary problem and the problem of the CAP, because they are intertwined—is by moving away from a centralised bureaucratic CAP towards national aids for agriculture.

It is the document's objective to try not to put forward some reform of the CAP but to remove permanently the unacceptable contributions that we make to the budget. The Commision admits—the Lord Privy Seal mentioned this—that the adjustment of the CAP that is proposed will not achieve the purpose of changing the contributions that we have to make to the EEC. Paragraph 41 states:
It is clear that their implementation could not have a significant impact for some time to come.

The Commission then looks for an alternative scheme or policy to try to solve the problem. The problem arises in respect of the EEC budgetary year 1982 and onwards. The result of the compromise of 30 May is a mechanism for 1980 and 1981. As I understand it, there is no agreement at present on our net contribution for 1982. If there is no agreement for 1982, will the Financial Secretary indicate what our net contribution might be during that year? We have calculated that our net contribution for 1982, in the absence of an agreement, could be £1,250 million or more. That will be the starting figure. Will the hon. Gentleman tell us what our net contribution for 1982 might be if the mechanism which the Commission is suggesting in the document is applied? The mechanism compares our share of the Community's GNP with our share of receipts under the CAP.

If there are to be negotiations between now and the end of November, and if the negotiations take into account the system advocated by the Commission, surely the British

Government must have the figures to enable them to determine whether the new scheme will be of benefit to Britain. The Opposition do not have the resources of the Foreign Office, the Treasury or the Commission, but we estimate that in 1982, under the Commission's so-called solution, we shall make a net contribution of about £800 million. Such a figure is unacceptable.

If we assume that the proposals are not agreed and that the proposals for 1980–81 are agreed for 1982, what will be Britain's contribution? We believe that extending the compromise of 1980–81 would mean that for the budgetary year 1982 our contribution would be about £500 million. There have been no proposals from the British Government. The Lord Privy Seal said nothing on this issue and did not indicate the proposal that he favoured. It is clear that the Government do not have the foggiest idea how to solve the problem.

As the amendment makes clear, and as the House has accepted unanimously on two occasions, the only real solution is for Britain not to contribute more to the budget than it receives. There is nothing revolutionary about that suggestion. As I have said, eight of the 10 members of the Community are already in that position. Only two member States contribute towards running the EEC—West Germany and Britain. What kind of a Community is it when only two members are paying to keep it going? Eight of the 10 members are receiving benefits from the Community in excess of the money that they put into it.

Four of the five richest countries in the Community are the three Benelux countries and Denmark. If they were in broad balance instead of receiving money from the Community, that would free £1,000 million on last year's figures alone. That sum could be spread among the other member States. We are making a modest request. We are asking for something that eight of the 10 member States already enjoy. We are asking only for a broad balance.

The French Government occasionally have to make a contribution, but in the past they have generally been in broad balance, despite the fact that they oppose in principle the notional juste retour. France has benefited from the notion of juste retour almost every year during its membership of the EEC.

Mr. Marlow:: Mr. Marlow: If I may put the same point to the right hon. Gentleman as I put to my right hon. Friend before, although the French Government are basically in broad balance budgetarily, they produce a mass of food which they sell to other Community countries at prices well above world prices. Although in terms of the budget they are in broad balance, they are making a massive profit out of the Community. That is one of the problems we are faced with when we try to renegotiate.

Mr. Davies:: Mr. Davies: I accept that. I am not arguing that France should not be in broad balance. If it is in broad balance—it may have other benefits from the Community too difficult to quantify in this debate—we ask that Britain should be in broad balance. We are not asking for more. That is a reasonable request. We want a fair and equitable balance in relation to our contributions to the Community. If past form is anything to go by, at the end of the day the Government will suggest a satisfactory solution. They have left the motion open to obtain a satisfactory solution and the Lord Privy Seal will use all his diplomatic arts to say that it is in the interests of Britain that we accept his solution. All we will get is a cobbled-up compromise that


will last a few years and do nothing to solve the basic problem. We shall have to return to the matter time and again.

If, on this occasion, the Government cannot produce a fundamental and radical change and are not able to solve this problem once and for all, the British people will not be fooled by any attempts to dress up this compromise as a permanent solution. What the Government will do is to increase the determination of the people of this country to rid themselves of the absurdity of the system and to free Britain once and for all from the shackles of the Treaty of Rome and the Treaty of Accession.

Mr. George Gardiner (Reigate):: Mr. George Gardiner (Reigate): It is a little late in the debate for me to join the welcome to my right hon. Friend in his new position but, at least, following the right hon. Member for Llanelli (Mr. Davies), I hope that it is not too late for me to wish him well in his task. I believe that he has already chaired a meeting of the General or Foreign Affairs Council. My right hon. Friend has therefore become blooded in his new role very quickly. Given the importance of this subject and these proposed reforms to this country, it is a matter perhaps worthy of passing remark how little interest or enthusiasm they seem to have elicited on the Opposition Benches.

For my sins, I look in each year at the Labour Party conference just to see what is happening. This year, I came away with the firm impression that these matters and the very question of our membership of the Community were burning issues. If they are of burning issues, the flame is certainly flickering very low this evening. I do not think that there have been more than five Members of the official Opposition present at one time.

In fairness, I should say that it is even more remarkable that we have had not a single representative from either the Liberal Party or the Social Democratic Party to join these discussions. It had been my impression that a commitment to the Community was, if you like, a basic test of membership of the Alliance or either of its two constituent parts. Clearly, however, that enthusiasm does not extend to any wish to join in discussion of how the Community can be improved for this country or its institutions strengthened.

Just before this report was presented by the Commission, I and one or two colleagues on the Government Benches had the opportunity to visit Brussels and to talk to Commissioners on how their ideas were taking shape. It is fair to say that we were impressed by their determination to apply some original thoughts to the problem before them and to come up with some propositions that they regarded as pretty radical.

The Commissioners must have been disappointed at the criticism that has been heaped on their report from a number of quarters, most notably from within the European Parliament. It seems to me that the central and most important weakness, almost notable weakness, in their report is its treatment of the problem of the distribution of resources within the Community as if it were purely a British problem. It is, of course, not purely a British problem. It is dangerous to treat it as if it were. It is a Community problem.

West Germany, since the settlement of May 1980, has become by far the largest net contributor. Many would

argue that this is only fair, given the strength of the West German economy. What, however, are we to say about the position in which Portugal or Spain will find themselves under the present arrangements once they become Community members? Surely, we are not then to go through all this process yet again to ensure that Portugal, for example, does not become a large net contributor to the Community that it has joined.

We need a corrective mechanism for the distribution of resources within the Community that will meet not only Britain's needs but also the foreseeable future needs of an expanding Community. United Kingdom Ministers have already made a constructive response to the suggestions outlined in this document. I am glad to see that the Minister of State, Foreign and Commonwealth Office, on 14 September made strongly the point that as things stand within the Community there is very little effective central management of the demands that are presented under different budget headings. He said:

"The problem of budget imbalances has arisen because policy decisions are taken by different Councils in different contexts with little regard to cumulative effects on individual countries. If arbitrary consequences are to be avoided then the Community should, in our view, take conscious decisions on how the budget as a whole should affect individual member States."

That must be an important element in any changed mechanisms that come out of the current discussions.

Mr. Donald Anderson (Swansea, East):: Mr. Donald Anderson (Swansea, East): Given that this is a laudable aim, is there anything in this document suggesting that such a view will be taken?

Mr. Gardiner:: Mr. Gardiner: I agree with the hon. Gentleman. That is one of the criticisms that can be levelled against the document. Indeed, it was the implicit criticism of it being levelled by the Minister of State in the remarks I have quoted. In further support of that, I make an observation that I have heard several times in Europe about the Council of Agriculture Ministers.

It is observable often that it makes little difference which country the Minister represents and, indeed, whether the Government that sends him there is of the Right, the Right-center or Left complexion. Once there, they all act as Agriculture Ministers with their own farming votes to satisfy. The outcome presents a further headache for the remainder of their colleagues in the Community. I hope that we can create a structure in which the Community dog does not appear to be wagged quite so vigorously by that tail in the future.

I have been perhaps a little critical of the Commission's report. There is one aspect that I should like to commend particularly to my right hon. Friend because, although he mentioned it in passing, he was obviously not able to dwell on it at length. That is the element concerning an expanded social fund. This is an element that could be of great beneficial value to the United Kingdom.

It is a proposal that offers more new emphasis on job creation and preparing young people for working life. One of the things that we do rather badly in this country at the moment is to prepare young people and school leavers for working life. There is a great deal that we can learn from countries such as West Germany in this respect. It is very important, outside the context of this discussion, that we should devise better means for training young people and preparing them for industry, particularly immediately after they have left school, providing more flexible training than we do now and certainly over a much broader spread.

If my right hon. Friend the Secretary of State for Employment were able, over the coming Session or beyond that, to devise a more ambitious and imaginative and, at the same time, realistic programme for preparing those leaving school for the world of business and industry, I would hope that that would be an area that would attract strong support from the European budget, and particularly through the mechanisms of the social fund. My right hon. Friend and some of his colleagues might bear that in mind in the discussions that are shaping up further on the restructuring of the budget.

Mr. Teddy Taylor (Southend, East):: Mr. Teddy Taylor (Southend, East): Does not my hon. Friend accept that if he or anyone wants to have different forms of training for school leavers or anything else, there is nothing to stop us doing that now? What difference does it make whether this receives the stamp of the Common market social fund when we are net contributors to the budget and when every pound that we have got from Common market funds up to now has cost the British taxpayer £1.71? What difference does it make, particularly when the Government maintain the principle of additionality?

Mr. Gardiner:: Mr. Gardiner: With respect, I was not suggesting that schemes of the kind that I should like to see should be conditional upon receiving heavy support from the social fund. I entirely agree with my hon. Friend. If we want to do these things, we can go ahead and do them.

Mr. Taylor:: Mr. Taylor: Hear, hear.

Mr. Gardiner:: The point that I was making is that if we are seeking, as my hon. Friend is seeking, ways and means of getting more funds back into this country to balance those that go out, of which he has spoken frequently, this is a commendable way of doing it, and there is a great opportunity for us here to kill two birds with one stone.
I should like to deal with the negative attitude displayed by the official Opposition's amendment. We must look at the amendment and what the Opposition have to say in the context of their official party policy to quit the Community, come what may, without giving the citizens of this country even the courtesy of a referendum to reverse the decision that they took so overwhelmingly in the previous one. It is not for me this evening to dwell on the disruptive effect that that would have in this country on a scale that is impossible to imagine. However, I wonder how the Opposition, in putting forward such an amendment, imagine that they can help the Government to negotiate better terms for Britain while at the same time trumpeting loudly from their conferences elsewhere that they are pledged to withdraw Britain from the European Community whatever happens.

Although we always enjoy the contributions from the right hon. Member for Llanelli, particularly his shafts of unintended humour, we must regret that we do not have the pleasure this evening of the company of his right hon. Friend the Member for Stepney and Poplar (Mr. Shore), who, in the past, has treated us to some rather ambivalent thoughts on this subject. I should like to quote his remarks to us on 24 March 1980, when he seemed very confused as to whether it was a good thing for Britain to press for payments and refunds from the Community budget anyway, since he complained:

By seeking to secure increased Community expenditure in Britain we are allowing the EEC increasingly to determine our own public expenditure priorities and to increase its influence and competence over Government decisions in Britain."—
[Official Report, 24 March 1980; Vol. 981, c. 1087.]

The first thing that we would like to know from the Labour Party is whether it is in principle in favour of securing these refunds to us, and whether it wishes to see increasing Community expenditure in Britain on programmes of regional benefit—employment, retraining, or whatever.

Secondly, the Opposition have some things to sort out on their side in this respect. They cannot, on the one hand, say that accepting increased Community expenditure in Britain robs us of power to determine our own public expenditure priorities and, on the other hand, at the same time, allow one of their representatives in the European Parliament, Mr. Richard Balfe, to use his position on that Parliament's finance committee to seek to chop in half the refunds that were negotiated for us by the Prime Minister in the teeth of such hard negotiations. The Opposition must sort out what it is that they want. Do they want Britain to have the primary say on where these resources go, or do they accept Mr. Balfe's arguments that it is some Community institution that should have the right of decision on, this money is spent? When we hear further Opposition speakers, I hope that they will clarify that point.

Next, one cannot let this opportunity pass without drawing attention to the sheer hypocrisy underlying the amendment. Throughout Western Europe we have a problem of mounting unemployment. It has affected all members of the Community, but it is felt more acutely in Britain for reasons that were explained from the Front Bench only yesterday. In tackling this problem in this country, whether or not in conjunction with our partners, we must remember that it is access to Community markets that is essential for our industries and our jobs. My right hon. Friend the Lord Privy Seal has pointed out how 43 per cent. of our exports go to Community markets, Indeed, it has been established that 21/4 million jobs or so depend directly on such sales.

Of course, I am not pretending that if the Opposition had their way and we were to withdraw from the Community we would lose all those sales or, automatically, all those jobs. But it is a fact that if we succeeded in keeping two-thirds of that trade, the loss of the remaining third would still add 1 million to the dole queue that we have today.

There is more to it than that.

Mr. Teddy Taylor:: Mr. Teddy Taylor: Will my hon. Friend give way?

Mr. Gardiner:: Mr. Gardiner: No. My hon. Friend will be able to develop his arguments later.

We have heard in this debate of the non-budgetary benefits and costs which enter into these calculations. It has been said that West Germany, particularly in the context of its large net contribution, achieves non-budgetary benefits from this in terms of access to markets. A non-budgetary benefit that we in the United Kingdom get from this, and intend to get in a much more marked fashion, is the investment that we are trying to attract, the investment that is essential if we are to reduce the total of nearly 3 million unemployed and if we are to get the jobs that we need for the future. It is crucial that we get additional benefit, both within our own shores and from overseas investment.

Recently we have had very encouraging investment decisions by a number of large overseas companies—the Burroughs Corporation, Yates Industries, Sony, Motorola, National Semi-Conductors, Minnesota Mining and Manufacturing, to name just a few. I note a sentence in a recent report from the Scottish Economic Planning Department. It said:
New investment projects"—
in Scotland—
in recent months have often envisaged more than 80 per cent. of output being exported, most of this to Western Europe.
Do we imagine that these investors will still come to this country and establish new plants here if, instead of a domestic market of 270 million people, there is a domestic market of only 56 million? We know very well that soon those investment resources would be diverted into the main market.

Many of our own firms, too, would feel the pressure, as they felt before we joined the Community, of having to try to channel investment into the Community to get a foothold there. I maintain that that alone justifies an appeal to the House to treat the Opposition amendment with the contempt that it deserves.

In so doing, I say to my right hon. Friend and his colleagues "Go on. Get the best deal you can for Britain and for a strengthened and more prosperous Community, and take no notice of the treacherous whining of the Opposition."

Mr. Julius Silverman (Birmingham, Erdington):: Mr. Julius Silverman (Birmingham, Erdington): I shall not follow the hon. Member for Reigate (Mr. Gardiner), if for one reason only, and that is that I speak as the Chairman of the Select Committee on European Legislation &c. For that reason I shall not refer to the merits of the motion, nor to those of the amendment.

I want to put to the Lord Privy Seal one or two relevant questions. First, however, I should tell the House that this document has not been recommended for debate by our Committee. This is an interesting issue, and I shall go into its history in a moment.

The first question that I want to ask is: why has this document been produced at all in its present form? The second question is: why, having been produced, is the document being debated today in the House?

We should bear in mind the fact that the Commission had to fulfil its mandate by the end of June—by 26 June, I think. That means that it had to put concrete proposals before the Council before the end of June. Yet the document contains nothing like that. It is a vague document that expresses a number of sentiments, with perhaps one or two minor changes in direction.

It is true that the Commission is inhibited by the terms of the mandate, which provides that the main principles of agricultural policy shall not be questioned. The main policies relating to Common Market finances—that is, mainly the own resources policy—also shall not be questioned. Those restrictions impose considerable difficulties on the Commission in proposing a restructuring of Community policy in that connection. It does not do so.

Its policies are vague. In fact, that vagueness is commented upon in The World Today, which says:

Analysis of the Commission's report is complicated by its lack of clarity and coherence, It is in places vague or ambiguous and occasionally self-contradictory. The cause seems to have been that the final draft was prepared in haste."—
I stress that point—
with several last-minute revisions, and translated from the original French in even greater haste. Perhaps also some differences within the Commission remained unresolved when the final text of the document was drawn up. The effect is that the reader has difficulty discerning what, if any, meaning to read into some passages and reconciling what is said in one place with what is said in another. Although negotiations may be facilitated if proposals of this sort are not set out in too much detail, they may be hampered if the imprecision is such that even the broad intent is obscured.
I entirely agree with that analysis, having looked at the document.

Sir Anthony Meyer:: Sir Anthony Meyer: I am sorry to interrupt the hon. Gentleman. I recognise that we have to debate the document that is before us, that being all that we have, but, as we all know, the Commission has produced much more specific proposals during the past week. Those proposals contain figures that go a long way towards meeting our requirements. It is unrealistic that we should be so bound by procedure that we cannot take account of the realities.

Mr. Silverman:: Mr. Silverman: The point is that we are not discussing those proposals. Our discussions are confined to the document that is before the House. That is the subject of our debate. If there are more precise proposals, clearly they should be brought before the House and discussed here. Not only should they be brought before the House, but, in accordance with the procedure of the House, in the first place they should be brought before the Scrutiny Committee and be discussed by that Committee and then reported to the House, recommending a debate on specific items.

So far no other document relating to this matter has been brought before the Committee. That is a gross breach of procedure. Having read the report, I cannot help feeling that some time before 26 June—the deadline by which the Commission had to fulfil its task; in other words, produce the documents—someone said to someone else on the Commission "Look lads, we have to produce a document by 26 June", and so they produced something that has all the marks of being cobbled together at the last moment, as was pointed out by the article that I quoted. It contains sentiments that have long been in the minds of the Commission, but there is not a single specific proposal that the House or the Committee could discuss in concrete terms. That is my chief criticism of the document.

It was for that reason that the Committee decided at the earliest possible moment that the Minister of State should give evidence to the Committee, not only to clarify the Commission's proposals, but to state the Government's attitude to them. I am bound to say that we have made little progress in that respect today. The invitation extended by the Committee to the Minister of State was to give evidence this morning, and we were astonished to learn a few days ago that the debate was to take place this afternoon. Clearly, that did not provide any time for the Committee to consider the proposals and then report to the House.

That is a matter about which the Committee and the House have a serious grievance. The invitation to the Minister had to be cancelled. No doubt the invitation will be renewed in due course. Perhaps the Minister will bear that fact in mind. He will then be able to clarify these


proposals and state with much greater clarity the Government's views on them. I regard the whole situation as most unsatisfactory, and I bring this matter to the House's attention.

I ask two questions: first, can the Government say why the document in its present form was produced so late, bearing in mind that the mandate had to be fulfilled by 26 June, and why has this debate been organised for today? Secondly, why, if other documents have been brought forward, have they not been placed before the Scrutiny Committee and why are they not before the House today so that we can discuss them as an essential part of this debate? Those are questions that I am entitled to ask, not merely as a Member of the House, but as Chairman of the European Legislation Committee.

I shall not go into any of the proposals in detail, but, speaking now as a Back-Bench Member of Parliament representing a West Midlands constituency, I wish to ask the Minister one specific question. I notice that it is suggested—it is a suggestion of which I do not disapprove—that there should be an extension of the social and regional funds and that in that way the United Kingdom Government could recoup a certain amount of their contribution. However, it should be pointed out that this matter was dealt with in the sixth annual report on European regional development, in which the Committee referred to projects having been approved in Scotland, North England, North-West England, Wales and Northern Ireland.

In the West Midlands there has been a savage deterioration in the level of employment, and it has occurred rapidly and suddenly. No reference is made to that in this document, and no project has been provided for the West Midlands. Of course, that is a matter that is decided not so much by the Commission as by the Government, and that is a broad aspect of Government policy that I should like to have explained. Those who are suffering most seriously, not merely in terms of unemployment but in terms of a huge deterioration in their position, do not: understand it, and I should like to hear the Minister's views on it.

Those are the questions that I put to the Minister. I hope that before the end of the debate the House will hear the reply to them. I repeat that my Committee will renew its invitation to the Minister to give evidence, during which we look forward to hearing some clarification of the proposals.

Mr. Teddy Taylor (Southend, East):: Mr. Teddy Taylor (Southend, East): I share the views of the hon. Member for Birmingham, Erdington (Mr. Silverman), but I wonder why we are debating this matter at all. The document is little more than a series of broad generalisations which give no detailed indication of how the mandate can be carried out in a way which is politically acceptable to member States. What is more, to the extent that they are no more than general indications, they are not helpful to the United Kingdom. Those who doubt whether the paper is helpful should read page 5, which contains a full list of wide and general sentiments that make no real sense and give no indication of how the mandate can be pursued.

In the mandate we are concerned largely about how we can resolve the problem of the common agricultural policy and member States' contributions to it. Having read the document and the Foreign Office paper on it, and having

listened to the Minister and the Opposition Front Bench, I am depressed to discover that all the indications are that it will be extremely difficult—assuming that it is possible at all—to get any meaningful reform of the CAP which is politically acceptable to member States.

As the Minister said, the obvious problem is that of production levels, which are likely to rise. How can they be controlled? The Commission seems to believe that the answer lies basically in lower prices. Unfortunately, there is no indication that these necessarily result in a reduction in production. Indeed, in some quarters it is argued that a lowering of prices often brings about a further increase in production. But even if lower prices worked, and even if such a solution brought Community prices into line with world prices and succeeded in controlling production, does the Minister seriously believe that such a proposal would be acceptable to all member States unless they agreed at the same time to national "fiddles.' whereby the money could be made up with national cash? The idea that we could solve the CAP problem by lowering prices is not politically acceptable to all member States, and I doubt whether it would be acceptable to Britain and its agriculture.

What about the possibility of production curbs? The implication of co-responsibility payments basically is production curbs—in other words, we shall not finance open-ended production. Does the Treasury Minister believe that British agriculture—or French or German agriculture—will be prepared to accept what amounts to specific curbs on production? But even if that were the case, would it make sense in Britain's case when we are telling all our industries that they must become more efficient and productive? Our farming has a very good record in this connection. At a time when we are not self sufficient in food, how can we tell British farmers that they must produce less than at present? The Minister will be aware of the sentiments of those engaged in milk production about the existing co-responsibility levy.

There is a third way, of course. The Commission hinted at it, and I was delighted with the response to it by the Lord Privy Seal. It is not only to continue with subsidised exports but to have general agreements for continuing exports of subsidised food. The Lord Privy Seal was right to say that we must not solve the problem of overproduction by having a massive increase in the amount of subsidised food, which will not only wreck the economies of the poorer countries but create an intolerable burden for the CAP.

I am sure that Treasury Ministers were as appalled as I was that, despite all the promises, our exports of subsidised food to the Soviet Union last year broke all previous records. What is more, our exports of subsidised wine were way above all previous figures, and all the indications are that they will be up again this year.

Whatever the Government do, I hope that they will not try to solve the problem of CAP over-production by a massive increase in the dumping of food throughout the world. The example of sugar is a very good one. By the dumping of surplus sugar at a very low price, great damage has been done to some of the poorest countries.

Having listened to the Minister, I adhere to the view that I have held for a long time, that, despite all the Government's efforts, there is no realistic way in which we can look to major reforms of the CAP which are politically acceptable unless it is as the result of a "fiddle", by which I mean replacing CAP cash with national cash


to supplement it, or finding ways of disposing of production other than destroying it, as we do at present, or exporting it at knock-down prices and thereby damaging the world economy.

One hon. Member who has now left the Chamber repeatedly shouted "What about the farmers?" whenever a criticism was made by an Opposition Member. I accept that British agriculture has benefited from the CAP and the EEC. The prices made by British farmers have gone up considerably, since they have risen to EEC levels and the green pound has been removed. In this way British agriculture as a whole has benefited. however, I hope that those engaged in agriculture will look to the future with a view to deciding whether the CAP will be as good for them then as it is now. If we reform the CAP in any meaningful way, it means either curbs on prices or specific curbs on production, which will apply to efficient British agriculture as well as to those on the Continent who are still inefficient. In my view, there is no way in which we can increase prices without adding to the intolerable problems of overproduction by the EEC.

In the circumstances, British agriculture should be looking to the future, realising that the only real hope of long-term prosperity will be if Britain looks after its own agriculture, bearing in mind that we are not self sufficient in food. I doubt whether anyone really believes that there is a genuine way in which the CAP can be reformed effectively to bring supply and demand into broad balance and to get rid of the cheating and fiddling which up till now have maintained the CAP. They can be contained so long as the Government adhere strictly to their commitment to a ceiling of 1 per cent.

The only feature of the document which really worries me is that the Commission has been given an impossible task and that, as has happened in the past when given an almost impossible task, it has sought the answer in a further extension of Community activities, in setting up more organisations, in planning to spend more money and in trying to solve other problems because it cannot solve the ones before it. The paper states specifically that it is believed that it will help if there is an extension of the European monetary system, if there can be a Common Market energy policy and policies on new technology, training and employment.

I hope that before the Government plunge into a further extension of our involvement with the Common Market and with the Common Market's policies they will make a genuine and serious independent study of the impact of the EEC on the British economy and British jobs. Whenever we ask specific questions on that matter, we are told that it is impossible to find out. In a question this week I asked why British unemployment has soared so substantially, more than that of almost any other country in the Western world, while the four little European countries which did not join the Common Market in 1973—Austria, Sweden, Norway and Switzerland—now have virtually full employment as in 1972.

Mr. Dykes:: Mr. Dykes: Really?

Mr. Taylor:: Mr. Taylor: My hon. Friend knows the facts. He might say that Austria, Sweden, Norway and Switzerland are different from Britain, but they were different in 1972 as well. If we regard the plight of the jobless as our main concern, as we should, we should at least be prepared to

look at obvious and prima facie evidence on why, since 1972, our unemployment has soared so much, while the little countries which stayed out of the Common Market have done wonderfully well. In Sweden the percentage of unemployment has reduced.

The Minister cannot ignore this serious point. There must be an answer. I believe passionately that in our decision to join—this should colour the way in which we approach reform—we made a dreadful mistake for the British economy in that we joined when Western Europe as a whole was heading for decline. We joined at the time when the principle that "big is beautiful" was being destroyed, if one considers the economic situation in the world as a whole. We made the terrible mistake of making ourselves peripheral to what is a declining part of the world.

That is my point of view, but the facts support it. Surely before we go further, as recommended by the paper, we should have a proper, objective inquiry, a proper assessment of the effect of the EEC on the British economy. The effects have been substantial and negative. The Government must accept that our giving a net sum of over £3,000 million since 1972—over £1 million a day—must have damaged the British economy. That cannot be denied. If any country, particularly one such as ours with problems, is having to give foreign aid of £1 million a day virtually for nothing, for which we pay more and get back less, that must do damage, because it means that we lose £3,000 million of public spending that we could have used in other helpful ways, for example, for investment and reducing taxation. I hope that that point is accepted by all hon. Members.

It should be accepted generally that the CAP has damaged the British economy. It has given temporary relief to agriculture, but surely by removing the one competitive advantage that we had as a country—access to food at world prices—we have added considerably to the costs of British industry by unnecessarily forcing up the cost of living. No one knows whether we shall be able to buy the food at lower prices in the future. However, we know that there is a tax on imported butter of over 60p a pound, of 61.14p per pound on cheese, of 67p a pound on beef and of 27p a pound on lamb, which has pushed prices up considerably more than might otherwise have been the case. I obtained those figures from a parliamentary answer. Surely it must be accepted, even by the Euro-fanatics, that the CAP puts up prices in Britain and thereby adds to industrial costs.

Mr. Dykes:: Mr. Dykes: No.

Mr. Taylor:: Mr. Taylor: I hope that we shall not talk about slogans, but will look at the problem seriously and accept that if a tax is levied on food, if one's country is almost the largest importer of food in the world, and if those taxes are given to the Common Market, that must do some damage to the British economy.

Mr Dykes:: Mr Dykes: My hon. Friend knows that I was saying "No" because the Ministry of Agriculture, Fisheries and Food and the Department of Industry have estimated twice that in domestic food prices in the shops in Britain the original EEC farm gate prices represent only at most 10 per cent. of the total effect of price increases. It is domestic inflation that has had the overwhelming effect.

Mr. Taylor:: Mr. Taylor: The Government and their Departments have made various assessments. We know that for their


own good reasons the Government are trying to show the best face of the EEC. At present the Labour Party has a policy of withdrawal from the EEC. I do not believe that that will happen as the party is split too much. At the moment we are looking for propaganda.

Sir Anthony Meyer:: Sir Anthony Meyer: Is my hon. Friend insinuating that Government Departments are deliberately giving wrong figures?

Mr. Taylor:: Mr. Taylor: Certainly not. No Government Department would tell an untruth. If, for example, there is a series of six facts, three in one direction and three in another, it is possible for a Minister and others in their speeches to put more emphasis on one side than the other.

Mr. Dykes:: Mr. Dykes: What about my hon. Friend?

Mr. Taylor:: Mr. Taylor: I am trying to be objective. If any hon. Member disagrees with anything that I am saying, I hope that he will interrupt me. A parliamentary answer stated that the net cost to the housewives is £3,000 million per year, from which the costs of deficiency payments have to be deducted. I hope that it will be accepted that the CAP has damaged the British economy. We cannot assess the extent, but it has been a negative factor.

No one can deny that if countries erect a common tariff barrier they will do more trade within that barrier. What has worried me is the way in which that trade has changed. The positive balance with Europe, which was consistent when trade was increasing before we joined the Common Market, with an average profit of £300 million a year in the eight years before we joined, has suddenly become an average annual loss of £1,300 million. While that has been happening, our trade in manufactures in the rest of the world has been improving. Everyone knows the figures, because they have been given in parliamentary answers, which are available to all.

Mr. Dykes: Mr. Dykes indicated dissent.

Mr. Taylor:: Mr. Taylor: It is silly for my hon. Friend to disagree. Those figures were given to me by the Secretary of State for Trade in an oral answer. For example, in 1978, 1979 and 1980, Britain had a profit in manufacturing trade of about £15,000 million. On the other hand, in our manufacturing trade with the EEC, we had a massive deficit of about £5,000 million. We made a profit in manufacturing trade before, but now we make a substantial manufacturing loss. That considerably affects jobs. Germany is referred to as our best customer. We are now doing more trade with Germany, but our deficit in manufactures last year was over £2,000 million, which is about double our deficit with Japan.

What worries me even more is that we are becoming involved in more Socialist schemes through the EEC. That will do us more damage. We know the effect of the CAP. I fear that steel is moving in the same direction. Because we have problems with production, supply, prices and losses, we are moving slowly but surely towards a scheme for steel whereby there will be a substantial tariff wall, artificially high prices and controlled production. That will add considerably to the costs of British industry.

Mr. Marlow:: Mr. Marlow: This is alarming news. Quite reasonably, the Government are concerned about the effect of Japanese trade on the United Kingdom and about the massive deficit that we have with Japan in manufactured goods. My hon. Friend has said that we have a deficit in manufactured goods with the Federal Republic

of Germany that is twice as big as our deficit with Japan. Is it any less wrong that one of my constituents should lose his job because of competition with German ball bearing factories that have been heavily invested in for some time, when compared with another hon. Member's constituent—half a person, for the sake of comparison—who has lost his job as a result of Japanese electronics and technology? Should not the Government be as vigorous in their pursuit of the problems with German trade as they have been in their pursuits of the problems with Japanese trade?

Mr. Taylor:: Mr. Taylor: The exact figures are set out in the parliamentary answer that I received. The deficit with Japan last year was £1,187 million, while the deficit with Germany amounted to £2,007 million. Should we become more involved, or should we stop and ask ourselves whether the EEC has been good for the British economy and whether it has damaged jobs? Is the EEC a great job destroyer? If it is, should we approach reform from a different point of view and refrain from becoming more deeply involved?

It is possible to manufacture slogans and figures. It is also possible to pick out figures. I have made a desperate effort to avoid doing that. Let us take the figure mentioned by my hon. Friend the Member for Reigate (Mr. Gardiner) as that is at the nub of the argument. I refer to the figure of 1 million jobs. At Blackpool, it was included in the Prime Minister's speech. By coincidence, Mr. Roy Jenkins used it on the same day. It is suggested that if we lose one-third of our trade with the EEC when we leave it, 1 million jobs might be lost. The assumption is that one-third of our exports will disappear, but that none of our imports will disappear. It is strange that such a precise figure can be given, because whenever the Government are asked about the EEC's effect on jobs they say that it is neither possible nor realistic to isolate from all influences that bear on employment those that are due solely to our membership of the Common Market. I am scared that we are scratching round and looking for any figure that can be interpreted to show that the idea is good.

We have had a referendum and a vote. The Labour Party is split from end to end on the issue of the EEC. I am sorry to say that, but it is true. Therefore, we must look for the right type of reform. We should try to get equal contributions. The CAP will not be effectively reformed not because of a conspiracy by nasty foreigners, but because a major reform will not be politically acceptable. Before we become further enmeshed in more Euro-steel plans, Euro-energy plans, Euro-training plans and Euro-employment plans, we should stop and objectively consider why Britain has suffered massive and soaring unemployment since 1972. We have suffered greater unemployment than that experienced in the other EEC countries and infinitely more than those countries that did not join the EEC. The time has come to look at the situation objectively so that we can see which type of reform is most suited to the special problems of our poor nation.

Mr. Donald Anderson (Swansea, East):: Mr. Donald Anderson (Swansea, East): I shall try to follow the hon. Member for Southend, East (Mr. Taylor) in his objectivity and non-selectivity. I agree with the hon. Gentleman that one of the major adverse factors in our relationship with the EEC is that we joined it when the


European economy was slowing down. Therefore, many of the arguments that my colleagues and I used in the 1960s were less relevant as a result of the slowdown in world and European trade that followed the OPEC price rises.

I would agree with the hon. Gentleman that the common agricultural policy has probably had a negative effect on the United Kingdom. However, it is impossible to put a value on security of supply, which has been one of the major facets of the CAP. I agree that the prospect of radical reform of the CAP is remote and will probably founder on the rock of vested interests among those of our partners who currently benefit so greatly from it and on the fact that for many in Europe the common agricultural policy is the Ark of the Covenant and the high spot of European achievement. They fear that if there were a root and branch reform of the EEC the whole structure would crumble. That is a major factor.

If the position is as negative as the hon. Member for Southend, East says, that does not quite square with the desire expressed by the Iberian countries and possibly by Greece to play a full part within the EEC. The hon. Gentleman was a little disingenuous when he asked for an objective appraisal, a cost-benefit analysis of our relationship with the EEC. He knows as well as I that much of what he has asked for cannot be obtained. For example, who can calculate with any precision the tariffs that we may face if we leave the EEC? On the assumption that Britain would leave the EEC, who can make a proper analysis of the likely trends in world food production and the availability of agricultural supplies? Who could, with any precision, say what alternative markets—if any—there might be for the percentage of the 43 per cent. of our goods that we would certainly lose if Britain were no longer a member of the EEC? I fear that the hon. Gentleman is asking the impossible. From different standpoints the hon. Gentleman and I look at factors in a fairly subjective way.

The mandate is based on the May 1980 agreement. On any criteria, the agreement represented a substantial step forward for Britain. The agreement covered only the years 1980 and 1981, with—if there were no clear agreement to the contrary—a probable follow-through to the budget year 1982. My right hon. Friend the Member for Llanelli (Mr. Davies) asked the Minister several important questions. He asked what we were likely to pay over the exchanges—according to the best available estimates—in the budget year 1982 if the 1980 agreement were extended. If, on the other hand the current Commission's proposals were accepted, bridging the gap between our proportional gross national product and receipts from the CAP, what then would be the probable figure? We should like to gain some idea of the difference—probably negative—if the proposals contained in the mandate are accepted.

A positive feature is that for the first time our partners have recognised that an "unacceptable situation" has arisen. Given the smallness of our agriculture sector and the fact that the EEC budget is predominantly oriented towards agriculture, that was probably inevitable. The Commission was given a clear task to examine current policies, to propose structural changes to the budget and,

most important, to prevent a recurrence of the "unacceptable situation". It was asked, as far as was practicable, to provide a basis for a long-term solution.

The response to the mandate, on any basis, must be disappointing, particularly given the substantial intellectual resources available to the Commission. It is a typical piece of Euro-schizophrenia, in that it is mighty in word, weak in deed and gradualist in detail. The part that relates specifically to the British contribution which, after all, was the purpose of the mandate, is found only towards the end. In my first rapid reading of the mandate document I almost missed the reference to the United Kingdom. The reader is forced to fight his way through a jungle of tangled verbiage to reach the weak and inadequate conclusion.

My right hon. Friend the Member for Llanelli has already set out the grand principles in the first few pages of the report:
the Community's institutions owe it to the people of Europe and to history to defend and develop this inheritance.
The Community, soon to be enlarged to twelve, can set an example to the world.
The Community will finally take its rightful place in the world and become a catalyst for peace",
and so on. The principles are grand but the details are very inadequate.

Paragraph 21 gives guidelines on the reform of the CAP. With the possible exception of the refusal to sanction increased national aids, they are clear and sensible enough. They advise a greater adherence to the market, greater selectivity, greater quality control, and so on. But the time scale is not right. If the guidelines were implemented in detail—one knows the political problems of that—they are likely to have very little short-term impact on the excesses of the CAP.

Overall, the document is weak, partly because although the Commission was asked to provide a long-term solution to an unacceptable position, it has not done so. It has done a patching operation. The proposals that relate to the United Kingdom contribution are possibly less valuable to us than a continuation of the May 1980 agreement. The proposals are also weak because they exclude the Federal Republic of Germany, which, in terms of its contribution to the budget, is in an equally "unacceptable position". It pays over £1 billion per annum to the budget and has taken our place as the paymaster of Europe.

The proposals cannot provide a long-term solution because there is little attention to enlargement. The implications of the accession of the Iberian countries in 1983–84 are mentioned in paragraph 17 but only in passing. As the hon. Member for Reigate (Mr. Gardiner) said, at that time, on present principles, Portugal is likely to be a net contributor. If one compares Greece with Ireland, in terms of benefit per head of population, there is a factor of about 1:9 in favour of Ireland, which on any basis of integration and common purposes is wholly inequitable. Nothing is suggested to remedy that position, which will arise very soon.

Although the grand federalist principles are enunciated in the opening paragraphs of the document, nowhere is there a serious suggestion of a transfer of resources between rich and poor on a European basis, as is done on a national basis by the tax or social security mechanisms.

The essential weakness of the document is the gap between the aspirations—the grand principles—and the reality. The vision of the founding fathers, regrettably or not, is clearly not now realisable, yet lip service continues to be paid to that immediate post-war vision and a more


realistic vision has not been adopted. If the new Europe is to have any meaning, it must be rooted in the possible. We shall have to jettison the expectation—grand though it was at the time—of the federalists in the immediate postwar world, when the old landmarks of Europe had been obliterated in the " European civil war".

The new Europe must be based on the reality of national States pooling their sovereignty for perceived common purposes—be they industrial, commercial or political, as in the Middle East—for their mutual benefit. Hence, there will clearly be a need for agreement in the steel sector and also, one hopes, in response to the challenge from Japan. This co-operation on a basis of perceived problems can lead to a real unity in key areas.

In my view, it should also be rooted in the concern of the people of Europe. Several hon. Members have mentioned employment, and the background faced by all our peoples within the Community is that of a worsening economic and social position.

I welcome paragraph 36 on regional policy, which mentions greater selectivity. But, of course, after enlargement, areas in the United Kingdom are likely to find that their portions will be reduced because of the demands of Greece and eventually Spain and Portugal.

So far as it goes, I also welcome paragraph 37 on the social fund, which talks about greater flexibility. Having said that, the problem of resources is touched on only gently in paragraph 45. Yet that is fundamental. Having said why I believe this document to be a wholly inadequate, short term and timid response to the mandate given at the end of May 1980, I should like to suggest the response of the Council of Ministers to it. The document's inadequacies should be recognised. It should be sent back. The Council of Ministers, as a body of responsible and accountable politicians rather than Commissioners and bureaucrats in Brussels, should realise that public opinion in Europe is increasingly bored with the enterprise—

Mrs. Kellett-Bowman:: Mrs. Kellett-Bowman: As the hon. Gentleman has said, this document is only an outline. The debate is suffering very much, as the hon. Member for Birmingham, Erdington (Mr. Silverman) said, from the fact that we do not have the other five documents. Unfortunately, we cannot refer to them because they are not before the House. However, the hon. Gentleman should remember that the Council will have those documents.

Mr. Anderson:: Mr. Anderson: Documents can be produced indefinitely. But the Commission, with all the resources at its disposal and all the think tanks that have agonised over the direction of Europe, has emerged, with this inadequate document even though a quite sufficient period of one year was available. That suggests something about the decision-making processes within the Commission.

The leaders of the various countries on the Council of Ministers should realise more and more that this approach is irrelevant to the problems as perceived by their own electorates. Unless more adequate propsals—perhaps the five documents; who knows what may be produced at the last minute?—are produced, it will be too late for Europe if the Community shows itself slow to respond to the real issues, worries and anxieties of our own people.

Mr. Hugh Dykes (Harrow, East):: Mr. Hugh Dykes (Harrow, East): Like other hon. Members, I shall refer briefly to the inadequacy of the

document before us. However, my thoughts and conclusions are different from those of other hon. Members.

The hon. Member for Swansea, East (Mr. Anderson) made the mistake that is always made, namely, to blame the poor long-suffering Commission for producing inadequate proposals and timid documents. However, after years of bitter experience the Commission is fed up to the back teeth with continually being knocked on the head by the Council of Ministers, which in recent years has displayed a complete absence of any political and collective will to take the Community forward in an institutional and collective way.

The demoralisation experienced continually in the Commission, as well as at lower levels and in most of the important directorates-general, is a problem that can be overcome only if the Council of Ministers resumes sufficient political will to take the Community forward. That is the tragedy. It means also that hon. Members who are malevolent towards the EEC and all that it stands for have a wonderful opportunity to have the best of both worlds. They say "How dare the Commission produce proposals" and "We want everything done on a national basis again", yet, when the Commission produces proposals they criticise them as being intrinsically inadequate and timid.

If only we could elevate the debate about Europe and its future to a higher level of constructive proposal, it would improve the workings of the Community for all citizens and member States. We should do that instead of harking back to the fundamental argument about entry. We shall have to endure that even more in future, because the Labour Party—for internal reasons, as usual—has decided to advocate withdrawal from the Community.

We have had slightly veiled references to that stance tonight from the right hon. Member for Llanelli (Mr. Davies). I remind the House that the right hon. Gentleman's statistical, mathematical and intellectual authority collapsed last year when he declared boldly that 25 per cent. of the population of France was on the land, whereas the latest figure, issued six months ago, shows 91/2 per cent. No one can have confidence in a spokesman for the Opposition—now for foreign affairs, but previously for Treasury matters—who can make such a massive blunder. The right hon. Gentleman has still not apologised to the House; nor has he explained how he made that mistake. Everything that he says is coloured by that mistake, and not only his statistical but his intellectual authority has collapsed. Therefore, we cannot accept his arguments and we reject the amendment utterly.

I was struck by the words of my right hon. Friend the Lord Privy Seal—and I, too, congratulate him on talking from the Front Bench for the first time on the subject—when he reminded us how modest is Britain's European Community contribution—although we agree that it should be reduced as much as possible pro rata in future and although our burden of payments is unfair. I believe that the whole House acknowledges and admits that.

I am reminded of the figures in Cmnd. 8175 which show that, on an outturn basis for 1981–82, the net contribution of £531 million compares with total public spending in Britain of £104 billion. Social security alone takes nearly £28 billion, health and personal social services £121/2 billion, defence £12.3 billion, Scotland £5.7 billion and Northern Ireland—with a small


population—£3.2 billion, and lending to nationalised industries was then estimated at £.1.8 billion, although it is now more.

The reality is that we make a net contribution that looks relatively heavy in comparison with those of other member States, for accidental mechanistic reasons that are not the fault of either ourselves or other member States. They reflect a pattern of trading and a historical and economic pattern that are different from those of other member States, but they are becoming less so as the years go by. The sum that we receive in total benefits for our Community membership is a tiny figure.

It remains extraordinarily incomprehensible and bizarre that the Labour Party is in favour of increasing public expenditure when it is domestic pound notes, but not when it is Community pound notes, or whatever currency we are dealing with. That is a gross inconsistency that it has never properly explained.

I wish that the document were more concrete in its proposals. I agree with the suggestion that the CAP proposals are more radical and bolder than some people would give the Commission credit for. I do not believe that the proposals are timorous in that sense. The Commission is now going along the right lines.

Mr. Marlow: Mr. Marlow rose—

Mr. Dykes:: Mr. Dykes: My hon. Friend has intervened five times in this debate already, and those interventions have been long. I believe that in the previous EEC debate he made 10 extremely lengthy interventions. The House is sick and tired of his silly contributions. As I said earlier, we now wish to elevate the debate, and I should prefer my hon. Friend to keep quiet and listen to my remarks. Otherwise, my speech will be too long, which will be unfair to succeeding speakers. My hon. Friend has far more than his fair share of time. He is the equivalent of France in terms of Community contributions—he gets too much.

The document is more constructive than others on the agricultural proposals, particularly the idea of the production limiting mechanism. That is the point to focus on, so that we avoid the production excess problems. It is all very complicated, but that is the direction in which we should go. However, there is a dilemma for the House and for the Community, and we might as well face it. That is why I continually end up in favour of a significant expansion of the total Community budget. Some hon. Members on the Labour Benches may also be in favour of that, but they dare not admit it, because of the Labour Whips. That must be the only way to proceed.

We all know that even if we limit agricultural spending in the Community budget—which is a good thing per se—there is no way in which we can substantially reduce it. That is unrealistic. Therefore, to get more of the desirable currency in pound notes that this country desperately needs in other non-farm areas we must have a major expansion of the Community budget. That is the way to cope with the problems of maldistribution of resources in the Community.

If our pattern of trading, economic history and internal economic configuration is different from the others, because we have a small agricultural sector and import pro rata too much from the rest of the world in comparison with other member States, let us build up the social,

regional and energy research and development funds—the other non-agricultural funds in the Community—to give us more money.

Why is it so immoral and wicked to suggest a significant expansion of the Community budget? I hope that the Minister will listen to this idea. Let us make it 50 per cent. more. I know that this is difficult for some to take, but I am in favour of exceeding the 1 per cent. ceiling in due course. We do not have to worry about that happening now, because the inflation receipts and the rise in world food prices has kept the figure below 1 per cent. for longer than we expected two years ago, but eventually we shall come up against it.

I am in favour of the Community raising international loans and borrowing money. A lot of that money could then come to this country and we could invest it in longterm capital projects. It is a good idea. I wish that my hon. Friend the Member for Northampton, North (Mr. Marlow) would accept those sensible ideas to build up the Community and not denigrate and knock it all the time.

That denigration and knocking are more modulated now. I have an interesting document produced by my right hon. and hon. Friends in the European Reform Group, some of whom were previously in favour of withdrawal, but who now appear to have dropped that and only want reform. I hope that I am not misrepresenting them. It is a fascinating document, called "Eurofact". It costs 20p. I see from the last page that it was printed in Southend-on-Sea. The document asks:

'don't we get advantages for our own people in freedom to work in the EEC and to obtain benefits? Yes, but this is rather one sided. In May 1979.… there were 620,000 EEC nationals over 16 … in the United Kingdom and 410, were at work."

Mr. Teddy Taylor:: Mr. Teddy Taylor: There is a comma after the "410" and it means 410,000.

Mr. Dykes:: Mr. Dykes: Perhaps the printers—Circle Services, 19 Clarence Road, Southend-on-Sea—will not make printing errors next time.

The question that is most important in the document is "Has our trade improved?" The answer is "Yes". However, I wish that my right hon. and hon. Friends in the European Reform Group would be balanced in their arguments. My hon. Friend the Member for Southend, East (Mr. Taylor)—I do not know whether he arranged the printing of the pamphlet—knows that we do not normally have a surplus with other advanced areas of the world, including other member States.

Mr. Teddy Taylor:: Mr. Teddy Taylor: We used to have.

Mr. Dykes:: Mr. Dykes: Traditionally, we normally had a surplus only with the less developed parts of the world. We never normally had a surplus with any advanced area, whether in the EEC or not. That is the point on which my right hon. and hon. Friends must focus.

Mr. Teddy Taylor:: Mr. Teddy Taylor: It is not true.

Mr. Dykes:: Mr. Dykes: I shall not give way, because time is short. I make my points and it is for hon. Members to deal with them later.

I was struck by the contrast between the Labour Party's attitude and that of the French Socialists to the Community and to this document. On 13 October the French Minister in charge of European affairs issued a memorandum on behalf of the new French Government. That document


emphasises points that would fit in with not only the philosophy but some of the details of the document before us.

The French Minister proposed, inter alia, increased Community borrowing to promote investment in high technological industry. He dealt with the expansion of the European monetary system and the greater efforts needed to align the economic policies of member States.

We are confronted with high unemployment everywhere, although the figure is much worse here. That is not due to the reasons aired by some hon. Members. Unemployment is higher because our economy has been deflated more than the economies of other member States.

Interestingly enough, the document deals with a proposal for the development of what is called "A European Social Space". That is not an inspired description. It states that job creation policies would be pursued by methods such as a reduction in the working week, which is coming in this country.

It is interesting to contrast the positive ideas detailed by the French Socialists, who seem to want to have nothing to do with Labour Members here, and the negative attitude and ideas of the Labour Party in this country towards both this document and EEC membership.

In the French memorandum there was an emphasised proposal for a greater drive towards European self-sufficiency in energy. Those key proposals fit in well and closely with some proposals in the Commission document. It sounds strange for me to say that the French Socialists have good ideas, but they do. I believe that we can follow the proposals in the memorandum and observe whether the Government can take them up when the European Council meets at the end of November.

One of the most important aspects must be membership of the European monetary system. I wish that we could become a member as soon as possible.

Another important point is the need to align the economic policies of member States. There is no point suggesting that one should have greater harmonisation of the Community budget but not the concomitant harmonisation of economic policies in general. Economic policies in general include interest rate policy, monetary control policy and all other parts of the total apparatus.

We should aim for those objectives and not fear that we are losing some sort of essential totem sovereignty. That is out of date, old-fashioned and unreal. By working in close harmony in the Financial Council, the Finance Ministers could do much more. They would have greater control of the EEC budget, which is an important point, and would have greater co-ordinating ability of the different member States' economies. There would be a greater convergence of rhythm, output and expansion than we have now.

We have to support what is stated in the proposal. We await the arrival of the document referred to by my hon. Friend the Member for Lancaster (Mrs. Kellet-Bowman).

I refer finally to "European File" of October 1981. As hon. Members know, that is produced by the Commission. The Commission specifically referred to "The British problem". It said:
The advantage that each member country gains from Community membership cannot be solely computed in budgetary terms: the introduction of a common industrial market"—
we still do not have that—
"respect for European competition laws and the international role of the Community cannot be translated into budget credits."

The document continued:
"The recovery envisaged by the Commission would allow a better balance in the allocation of financial resources.

I believe that we must focus on that last point.
While waiting for the recovery to take hold, Community solidarity, meaning the desire to increase confidence between the member countries and thus enable new progress to be made, dictates that a solution be found to a problem that the Commission feels only really affects one country, the United Kingdom.

I know that that is not the Government's view. They have asserted that the problem is common to other member States. We know that we are suffering the worst effects of the imbalance and dislocation, but we should give the essential combined will to the Community—the Commission and the Council of Ministers acting together—to rectify that problem, while expanding the Community and building up the budget so that we can build up the British national economy again.

Sir Anthony Meyer (Flint, West):: Sir Anthony Meyer (Flint, West): By calling my hon. Friend the Member for Harrow, East (Mr. Dykes) before me, Mr. Deputy Speaker, you have saved the House some time, because he has made the most of the points that I intended to make in what I expected to be a brief intervention anyway.

The admittedly rather battered document before us is an early part of the process of trying to make the EEC a more just Community. My right hon. Friend the Lord Privy Seal called it a step in the right direction and I am certain that, under the Presidency of my noble Friend the Foreign Secretary and the other Ministers who have greatly distinguished themselves in conducting the meetings over which they have presided, the process of making the Community fairer and more just will be carried forward rapidly.

It is important that the Community should be seen to be even handed in its treatment of member States. Almost all the firms in this country are aware of the need for us to remain within the EEC and to retain guaranteed access to a market of 270 million consumers. Of course, there are worries, eagerly fanned by those who oppose our membership, that, whereas we obey the rules, no one else does. Therefore, I welcome the emphasis in the document on the importance of an effective competition policy.

A firm in my constituency that manufactures steel wire is gravely threatened by what it regards as unfair competition from Italian producers of steel wire. It has tried repeatedly to get figures to prove that the competition is unfair, but is reconciled to being unable to establish that. A properly enforced and effective competition policy would go a long way towards making that firm feel that at least it was not fighting with one hand tied behind its back.

I should like to raise a matter, which I do not expect my right hon. Friend the Lord Privy Seal to deal with, but which I hope he will pass on to the appropriate Minister. I suspect that some firms are damaged by the operation of parts of the Restrictive Trade Practices Act 1976 that may prevent sensible zoning arrangements that could enormously reduce the distribution costs of British firms.

For example, if the firm in my constituency is having to beat off competition from an East Midlands firm by seeking outlets for its produce in East Anglia, both firms


are incurring transport costs that diminish their advantage over, say, Italian exporters of steel wire who have to send their goods much further.

Informal arrangements to encourage firms to seek customers in their own areas, as far as possible, would maximise the distribution costs advantage of local firms, as opposed to overseas firms, but they might fall foul of the 1976 Act. I should like Ministers to consider whether the Act is imposing unnecessary additional burdens beyond the requirements of a fair EEC competition policy.

It is now clear that the cause of British participation in the EEC has passed and recovered from its low point. Its unpopularity was very largely based on ignorance and was aggravated by the campaign that the Government necessarily had to wage in order to secure a reduction in our budget contribution.

Public opinion polls are registering a slow but steady improvement in public opinion on the EEC. This will intensify as the Labour Party, which is the only major party committed to British withdrawal, continues on a downward spiral, which is in its turn given a fresh twist by the extremism of the policies that it is advocating. The Labour Party is all alone with a policy that becomes less and less tenable the more closely the party looks at it. The figures that we have exchanged this evening on the relative cost of maintaining British agriculture by deficiency payments go a long way to demonstrate it.

It is very easy for people such as my hon. Friend the Member for Southend, East (Mr. Taylor) and Labour Members to demonstrate the admitted manifold drawbacks of membership of the European Community. It is open to them to argue that we would be better off without membership. I do not for a moment accept that argument, but it is one that they are perfectly free to put forward. What cannot possibly be maintained is that this country could derive any conceivable advantage from withdrawing from the EEC, with all the consequent rupture of existing ties and the accusations of bad faith that would necessarily follow. That being so, I do not see how for one minute that argument can be sustained.

Mr. Tony Marlow (Northampton, North):: Mr. Tony Marlow (Northampton, North): I will be brief. All I wish to say to the Government on the issue of Europe is this: "You can fool some of the people some of the time but cannot fool all of the people all of the time. Please, when you are putting the case to the public, do not put things forward that are manifestly wrong".

We hear about the million jobs that we would lose if we changed our association with the EEC. I am not saying, and most people are not saying, that we should come out, but we are getting a raw deal at the moment. It can be proved that the balance of jobs goes the other way. My hon. Friend the Member of Southend, East (Mr. Taylor) made a telling speech on that subject.

When we go into the negotiations, all I ask is that the Government should remember the appalling deal that we are getting at the moment, and not just with the budget or the common agricultural policy, which is quite unsuited to a food importing country. There is the fact that we are buying European food when we could otherwise get it at world market prices. There is also the fact that we have a trading policy that does not suit us, given the difference between our industry and European industry.

I say to the Government: "Fight for Britain within Europe, and if you get it right the British people will become more enthusiastic towards Europe. If you get it wrong, you will have the right hon. Member for Bristol, South-East (Mr. Benn) putting before the public a popular platform, a popular programme, for getting out of the Community, which will destroy everything that you are trying to do."

Mr. Denzil Davies:: Mr. Denzil Davies: The debate has been fairly true to form in respect of the debates that we have on obscure Commission documents. They generally end in a kind of slanging match between the pro-Marketeers and the anti-Marketeers. Tonight it has been even worse because of the poor quality of the document before the House. Indeed, the slanging has come from the Conservative Party. We have had three pro-Market speeches from Tory Back Benchers and two anti-Market speeches. The debate has shown the deep split which exists in the Tory Party on this issue. Clearly, it is split as it has been in the past, and I do not see any evidence of that split resolving itself.

We were told from a sedentary position by the hon. Member for Lancaster (Mrs. Kellett-Bowman) that we should be debating five documents tonight. We have had one document, with no figures, but apparently there are five documents. I hope that the Financial Secretary will tell us why he has not seen fit to put before the House the five documents. We have read in The Guardian and the Financial Times about the figures that the Commission is producing on the CAP. I have no doubt that the Treasury and the Foreign Office have them. I am sure that they are at the fingertips of the Financial Secretary. Where are the five documents? We shall want to debate this matter again before the meeting on 25–26 November. The necessary information is not before the House. I hope that the hon. Gentleman will give the assurance that we shall have a proper debate when the Treasury has considered the documents.

Before the end of the year we shall be considering some sort of solution to the budgetary problem. The House should have all the necessary figures to enable it to make up its mind. I hope that the Financial Secretary will tell us something about the five documents and give the assurance that when we debate these matters again we shall have all the documents before us and not merely one inadequate Commission document.

I put some specific questions to the Lord Privy Seal and I put them again to the Financial Secretary as a marker. I realise that I may not get a full answer on this occasion. First, what is the Government's attitude on the co-responsibility levy? Are they against the levy? Secondly, will the hon. Gentleman give an assurance that the Government will not agree to any increase in the VAT ceiling of 1 per cent.? Thirdly, does he agree that we must have comparative figures on the effect that the various suggestions will have upon our budgetary contribution? Those figures must include the present position, the position if we agree to the Community document and the position if there is no agreement. The House should be given the figures so that it can form a judgment and decide whether there is a satisfactory solution to Britain's budgetary problem.

I am sorry that the three Conservative pro-Marketeers did not concede that it is reasonable to argue that Britain should not pay more into the Community than it receives


from it. Surely there can be general agreement on that. I know that there are other factors to be taken into account. Those factors apply to all countries, including those which are net beneficiaries and those which are in deficit. However, there should and could be general agreement in the House that it is only fair and right that Britain should not pay more to the Community than it receives from it and that it should not be in a worse position than nine of the other countries of the Ten. It is disappointing that the Government are not accepting that part of the amendment. Surely they should accept that that is a sensible and equitable solution and that they should press for it.

It is clear that at the end of the day we shall not get a satisfactory solution. This running sore will continue until the British people decide to withdraw from the Common Market.

The Financial Secretary to the Treasury (Mr. Nicholas Ridley):: The Financial Secretary to the Treasury (Mr. Nicholas Ridley): Time will not permit me to answer all the questions to which I should like to respond. I say to the hon. Member for Birmingham, Erdington (Mr. Silverman) and the right hon. Member for Llanelli (Mr. Davies) that the document before the House was produced so that the debate could take place. It was the Scrutiny Committee's desire that a debate should take place. Documents have been deposited in the past day or two, an event that took place after the Scrutiny Committee decided that it wanted the document that is now before us to be debated. In my opinion that was a correct decision because it is an important document. I see nothing improper in holding a debate—

Mr. Denzil Davies:: Mr. Denzil Davies: What about the other documents?

Mr. Ridley:: Mr. Ridley: They are laid in the Library now. They have only just arrived. The document before us is only a basis for negotiations. It is the Commission's document and not the Government's document. The final outcome will depend on negotiations in the Council.

The agreement of 30 May 1980 was a great step forward. That was the view of the hon. Member for Swansea, East (Mr. Anderson), although it does not seem to coincide with the view of the right hon. Member for Llanelli. He asked me what would be the results for 1982 on three different possibilities. If there is no agreement about the mandate, the form of refund is clearly set out in the 30 May agreement. It is impossible to calculate, because 1982 has not even been reached let alone the finances determined. If the Commission scheme, as set out, is adopted, it is impossible to estimate the effect, because it is only an outline and not a precise scheme. We do not yet know what will be the costs of the Community budget next year. The United Kingdom will not be satisfied with the scheme put forward by the Commission. We shall seek to find a better solution than that which appears to be contained in the Commission's document.

Mr. Denzil Davies: Mr. Denzil Davies rose—

Mr. Ridley:: Mr. Ridley: The right hon. Gentleman has spoken twice. I have many points to answer. I shall not give way.

The Commission proposes to solve the mandate problem under three headings. One is non-agricultural expenditure. The reason why the hon. Member for Erdington has not yet received any assistance from the social or regional fund for his West Midlands constituency is that these contributions from the Community are

accredited to assisted areas only. The West Midlands is not an assisted area. This does not affect the distribution of United Kingdom expenditure but in order to qualify for the refunds certain projects have to be put up. It does not affect United Kingdom expenditure. It is just a device for reclaiming our money. The heading on which the House has spent most time is that concerning agriculture. We do not question the principle of the common agricultural policy, although both the Government and the Commission admit that it is capable of reform and are in favour of reforming it.

The United Kingdom Government are not in favour of the 1 per cent. ceiling being breached. This was one of the specific questions put by the right hon. Member for Llanelli although he is not even listening. We shall do our best to make sure that this does not happen. The amendment moved by the right hon. Gentleman was to the effect that we should come out of the CAP and establish our own agricultural regime. We have had the benefit of hearing what the Labour Party intends in this respect. Its plans were leaked in an article in The Guardian on 19 October. The House should hear some of what that article stated. It should be heard by some of my hon. Friends who have alternative ideas to the CAP and the agricultural policy we should pursue. It stated:

"Farm prices would be reduced in real terms and production of some commodities—the Labour Party discussion document suggests cereals, dairy produce and sugar—emphatically discouraged. A deficiency payments system would place a heavy burden on the taxpayer but enable shop prices to be held down … The burden on the Exchequer would be far higher than 10 years ago, the Labour plan admits, because, under the EEC regime British farm output has risen."

The article goes on to say:

"The cost of a new scheme would 'range between £400 millions and £1,700 millions a year at 1979 prices'".

That is agricultural Ken Livingstone stuff. That is what the right hon. Member for Llanelli has in mind. He will spend far more on deficiency payments than we ever spent on the common agricultural policy and he will drive agriculture in this country into the grave.

I should like to quote to the right hon. Gentleman his own party policy document, as reported in The Guardian article:

"The discussion document suggests that the proposed policy would involve considerable loss of jobs in food manufacturing, as well as in the agricultural sectors earmarked for decline".

The hypocrisy of the Labour Party in debating unemployment with tears in its eyes when it has positive plans for increasing it in agriculture is breathtaking. The idea that the Labour Party can produce a better agricultural policy than the CAP, with all its defects, is exploded by this detailed exposé of its policy. From what the right hon. Member for Llanelli said, I do not think that the anodyne amendment will be pressed. I can see why. When hon. Members, including those of my hon. Friends who have doubts about the CAP, see what is the alternative—massive agricultural devastation, and massive subsidies in order to try to placate the electorate—they will understand why it is better for us to stay within the CAP and try to renegotiate our contribution so that it is in accordance with the principles that the Government have always enunciated.

Question, That the amendment be made, put and negatived.

Main Question put and agreed to.

Resolved,

That this House takes note of the Report of the European Commission on the Mandate of 30th May 1980 (COM (81) (300)) and fully supports Her Majesty's Government in their determination to negotiate a satisfactory solution to the problems of budgetary contributions, to achieve reforms of the Common Agricultural Policy and to give an impetus to the development of Community policies.

Orders of the Day — British Leyland

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Newton.]

Mr. Stanley Orme (Salford, West):: Mr. Stanley Orme (Salford, West): I wish to discuss on the Adjournment the situation at British Leyland and the threat that that poses to British manufacturing industry and our economy.

After what the Opposition said in the House this afternoon, we regret very much that the Secretary of State for Industry has not seen fit to make a statement here this evening. Nevertheless, we are glad to see him present for this debate. We hope that he will be able to answer some of the pertinent questions about the dispute and to say, in particular, what action the Government will take to alleviate the situation.

I thank my hon. Friend the Member for Bishop Auckland (Mr. Foster) for withdrawing his Adjournment debate so that this debate could take place.

Mr. Joseph Dean (Leeds, West):: Mr. Joseph Dean (Leeds, West): When between 4,000 and 5,000 car workers lobbied the House of Commons last week because of the threat to the future of their industry, does not my right hon. Friend think that it is disgraceful that in this so-called bastion of democracy, and bearing in mind the fight that he put up earlier today, he has had to resort to asking one of our Back-Bench colleagues to give up an Adjournment debate so that this issue, which is of such importance, could be raised? Is it any wonder that some people outside this House decide that democracy itself is failing them?

Mr. Orme:: Mr. Orme: I take that point. Now, however, we must make the best of this debate from our point of view. We must put to the Government some of the crucial issues on which we want answers.

As far as British Leyland is concerned, we are now at four minutes to midnight. We are within hours of the start of what would be one of the largest industrial disputes in Britain's recent history. I think that the Secretary of State is aware that the dispute is to start at midnight on Saturday and that on Sunday 1 November the first of the shifts will stop work. And this when there are about 3 million unemployed. In their inaction and ineptitude, the Government are not prepared to take any direct action.

I have an editorial from The Engineer, of 22 October, a monthly magazine for middle and senior management. It says:

"In another industry it might have worked. But at BL, 3.8 per cent. after three years of sub-inflation awards has reawakened the aggressive anger of the car workers.

The Engineer warned a month ago that anything less than 4 per cent. would be insulting. The insult is now on the table and the value of employment by Britain's single most important manufacturer and exporter has dropped to the point where the reward for unemployment is worth within £10 a week as much as a pay packet.

Even with nearly 3 million people seeking work, labour has a price below which it is not prepared to go. Sir Michael's advisers are better placed than most to measure that price, so it is perturbing that he should get it so badly wrong. Had the price of steel changed to the point where he had to alter his strategy, that change would be made."

Well it can be made in wages.

We referred this afternoon to ACAS and the negotiations that have taken place today. I shall quote again, because it bears repeating, the statement made by ACAS:

"The separate exploratory discussions which ACAS has held with the trade unions and senior management of BL cars have not today produced any basis for reconciliation of the differences which exist between the parties. ACAS officials remain ready to assist in any way they can and will be keeping in touch with both sides."

I have spoken to some of the senior negotiators of the trade unions tonight, and they tell me that, as they see the situation, the BL management has firmly slammed the door, that ACAS has exhausted its procedures, and that so far as they are aware no negotiations are taking place at present. If they are, perhaps the Secretary of State will tell the House the basis of those negotiations.

We have a right to ask the Government what action they propose to take. British Leyland is a publicly owned company, and the responsibility for its future lies with this House and the Government, not with Sir Michael Edwardes and the BL board. It is therefore vital that we discuss this matter.

I want to raise some of the issues with the Secretary of State, although not in a negotiating sense, because in my opinion the two sides are not far apart. It would be a disaster to allow this dispute to go on when there are means of resolving it.

We know that the company offered 3.8 per cent. That was rejected by the unions because it was on the grade rates. They felt that after 5 per cent., 5 per cent. and 6.8 per cent., they were entitled to a larger increase. Management said that it had some proposals on the bonus scheme. Eventually management came up with some proposals which would have given the minimum—a floor of 3.8 per cent. on the bonus scheme which no one would go below. Examination shows that only a small minority of workers would be involved in that floor.

The trade unions said "We have this bonus scheme. We are not parties to the way in which it is operated. It has caused a great deal of dissatisfaction within the company. However, if we have the bonus scheme and if the company would consolidate some, if not all, of the current bonus scheme on to the grade rates—in other words, transfer it over, and other benefits would arise because it would be on the grade rates—that would be a basis for negotiation." However, the management flatly refuses to take that action.

I should like to know whether the Secretary of State has been involved throughout the negotiations, because he made an unfortunate statement outside the conference hall at the Conservative Party conference in Blackpool. He said:
I am supporting Michael Edwardes and the BL board right down the line.
With those words he closed a crucial door which as Secretary of State for Industry he should have kept open. I ask the right hon. Gentleman, in the interests of the industry, to reassume his impartial position, look at the issues on their merits and, as a consequence, help to get the negotiations started again.

I was referring to the problem of consolidation. That would mean a transfer. It would also mean some new money—not entirely all new money, but some new money. We shall not get out of this dispute without some new money.

Mr. George Gardiner (Reigate):: Mr. George Gardiner (Reigate): Whose money?

Mr. Orme:: Mr. Orme: That is a very good question. It is the British people's money, and it has been put in jeopardy by the intransigence of the management of British Leyland

and the Government. We have £1,000 million of taxpayers' money invested in British Leyland. We have the promise that the company will break even in 1983–84. We have the success of the Metro. We have the new Acclaim in production. Here is a chance for us to climb out of the pit. Now is the chance for the British taxpayers to get some return on their investment. If the company goes into liquidation, so does the money of the British taxpayers, and the Government, who pay lip service to the protection of taxpayers and to investing in publicly owned industries, should now be considering seriously what action they can and should take.

Mr. Dennis Skinner (Bolsover):: Mr. Dennis Skinner (Bolsover): My right hon. Friend will recall that this Government tried a similar exercise in the early part of the year with another group of workers, namely, the miners. As a result of their bluff being called—we see the same principle today: it is a game of bluff, with the Government trying to outwit the workers—in that instance although they vowed and declared that the pits would close, because the workers stood their ground, as there is no doubt they will in this case, within a few days the Government had to find £40 million. They do not need £40 million to settle this one.

Mr. Orme:: Mr. Orme: I accept what my hon. Friend says, and tonight's debate is about how we move from the present position. I shall press the Secretary of State very hard, because it is his responsibility to see that negotiations start tomorrow and that they are open negotiations. What is more, it would be very helpful if the right hon. Gentleman chaired a meeting of the British Leyland board and the trade unions, with all the facts and figures on the table, so that the matter could be discussed afresh.

Having talked to the trade union leaders concerned throughout this week, I know their concern about the threatened dispute and I know that they do not want it to take place. The people working in British Leyland do not want it, but the vast majority say that enough is enough. Therefore, they have a right to ask for some action.

It is a cause of great anxiety to many of us that below the surface certain comments are being made about liquidation and the selling off of vital parts of the company. It is acknowledged generally—Sir Michael Edwardes himself acknowledged it on the "Nationwide" programme last night—that the letter containing the threat of no redundancy payments was regrettable. Sir Michael went as near as he could to make an apology for the terms of that letter. But it is not sufficient to withdraw the letter. It is now important for Sir Michael Edwardes—and if he will not do it, someone else should—to get the negotiations going again.

A statement that I received from a merchant bank source recently gave the following quotation:
Most likely the 3.8 per cent. wage offer will be accepted. If it is not and the company is broken up, its component parts may be quite successful and readily adapted to alternative activities.
That quotation was by Professor Alan Walters, who is the special economic adviser to the Prime Minister. Are the Government sitting back so that the company can be broken up? We are entitled to know whether Professor Walters wants to see a successful car factory in one unit, such as British Leyland.

The sacrifices which the workers have gone through are sufficient for the company to survive and for the Secretary of State to tell the House what steps he will take. We cannot afford to sit back and wait until the disaster occurs


and then hope that everything will be put back. The effects of the threatened dispute on the company are already sufficient in themselves to make people aware of the problems if the dispute took place.

Most hon. Members will have seen the article in The Times earlier this week by Sir Richard Dobson, a former chairman of British Leyland. He stated:
I would say to the board of BL and to the politicians behind them, please think once more … Do not mistake rigidity for courage; posterity will not thank you if the ship sinks for the lack of a ha'porth of tar.

The general press comment has been unfavourable to British Leyland. People are now beginning to realise that Sir Michael Edwardes and the board have got it wrong. I fail to see why we could not have had meaningful negotiations. All week we have tried to help so that the negotiations could be started. We have not tried to exploit the situation politically. No one can give me evidence of that. We are trying to save the company because we are talking about half a million jobs in the British economy, skilled people who, it they are thrown out of work, will probably never return as there will be no such work available.

We are talking about areas in the United Kingdom—the Midlands and elsewhere—which are dependent on the motor industry. We are also talking about component manufacturers who employ hundreds of thousands of workers. Those manufacturers are in the private sector, not the public sector. Many of them are almost dependent on a company of the size and capacity of British Leyland for their survival. Therefore, the knock-on effect of the closure of that company would affect hundreds of thousands of families up and down the country. How can we stand that on top of unemployment which is now over 3 million?

The Secretary of State must act and take up his responsibility as Secretary of State. We want him to initiate negotiations tomorrow. We want to see the strike averted. In my opinion, it can be averted. There is no need for that strike. Perhaps some Conservative Members hope that the strike will take place, but I do not believe that the vast majority of hon. Members want the strike to take place. Many Conservative Members are seriously worried. I have heard them speak on the radio and have seen them quoted in the press. They have a right to be afraid of what might happen to their constituents. The problem will exist not only in Labour constituencies but throughout the country.

I hope that the Secretary of State will answer the points that I have made. This is a major debate of great importance. I hope that we can avert the dispute. However, fresh measures and a fresh initiative are needed. Both sides must get round the negotiating table if a settlement is to be reached.

Mr. Douglas Hogg (Grantham):: Mr. Douglas Hogg (Grantham): Hot air.

Mr. Orme:: Mr. Orme: The hon. Gentleman may say that while he leans back, but we are talking about half a million jobs in the British economy.

Having put those points to the Secretary of State, I ask him to make a positive response.

The Secretary of State for Industry (Mr. Patrick Jenkin):: The Secretary of State for Industry (Mr. Patrick Jenkin): I hope that it will be considered helpful if I

intervene now in the debate. However, I am not sure how much I shall be able to add to the information that is available to the House.

The Government are well aware of the grave concern about the danger that looms over British Leyland, which has been most eloquently expressed by the right hon. Member for Salford, West (Mr. Orme) and which is felt both inside and outside the House. The Government's position has been made clear by my right hon. Friend the Prime Minister, who answered questions on this subject on Tuesday and again this afternoon. The conduct of the negotiations over pay—for pay is at the heart of the dispute—is a matter for the management of the company and the unions involved. It is not, and cannot be, a matter for the Government—[Interruption.] I should like to develop that point, because it is at the heart of the issue.

The management of the company is that appointed by the last Labour Government to manage British Leyland and, if possible, to restore the company to viability. Our predecessors backed the board with substantial sums of public money. They allocated to it about £870 million of taxpayers' money. As the House will remember, my immediate predecessor—the present Secretary of State for Education and Science—announced in January a further sum by way of support to British Leyland, amounting to —990 million. Part of that sum has already been made available and there is provision for the rest—about £540 million—to be made available to the company during the rest of 1981–82 and 1982–83.

Confirmation that that sum will be available will depend, as in the past, on the company's submitting its annual corporate plan to the Government, embodying proposals consistent with the planned path to viability. The company has been making huge losses, which are continuing at the rate of about £500 million in the current year. But, thanks to very effective management, and with the full co-operation of the work force—Sir Michael Edwardes paid tribute to that on television last night—the groundwork has been laid for recovery and the results are beginning to show. The right hon. Member for Salford, West mentioned some of them.

As the House knows, there are now new and, one hopes, very successful models of cars on the market. They have appeared on time and within planned costs. That in itself is a striking change from the recent past of the company. BL's market share has not only stopped falling, but is now rising, despite the most difficult trading environment for some decades. The productivity of the company is rising, despite the fact that the overall market has been falling. I know, because he has told me so, that the last thing that Sir Michael wants is the success for which he and all his work force have striven to be dashed from his hands. His reputation as a manager depends on his achievements in setting BL on the road to economic viability.

Progress depends crucially—again as Sir Michael said on television last night—on the company keeping its costs firmly under control. Wage costs must be part of that process. If costs rise outside the limits of the corporate plan, that plan ceases to be viable and cannot be proceeded with.

Mr. Skinner:: Mr. Skinner: Sir Michael Edwardes got a 38 per cent. pay rise this year.

Mr. Clinton Davis (Hackney, Central): Mr. Clinton Davis (Hackney, Central) rose—

Mr. Jenkin:: Mr. Jenkin: First, I shall answer the sedentary intervention of the hon. Member for Bolsover (Mr. Skinner). I heard what he said. He has a clear and unmistakable voice.

The auditors of BL are prepared to confirm that the average annual percentage compound rise in the period of Sir Michael's chairmanship of the company has been about 5 per cent. a year—[Interruption.] That is the cost to BL of his emoluments and pension.

Mr. Clinton Davis: Mr. Clinton Davis rose—

Mr. Jenkin:: Mr. Jenkin: As I said, if costs rise outside the limits of the corporate plan, it ceases to be viable and cannot be proceeded with. It is against that background that the present dispute has to be seen.

The view of the board of BL has been made clear. It has said that if effective and financially damaging strike action takes place at BL, the board will have no option but to consult the Government on the steps that will be needed to liquidate those parts of the business that are prevented from working. That stage has not yet been reached.

Mr. Clinton Davis: Mr. Clinton Davis rose—

Mr. Jenkin:: Mr. Jenkin: I hope that the hon. Gentleman will forgive me if I do not give way. I think that the House wishes to hear what I have to say. Hon. Members were asking loudly enough this afternoon.

Strenuous efforts have been made by both sides to find a solution. The right hon. Member for Salford, West said that he thought that the unions were very anxious to find a solution, and I believe that that is true. I understand that the separate exploratory discussions that ACAS has held with trade unions and senior management of BL today have not produced any basis for reconciling the differences between the two parties. However, ACAS officials remain ready to assist in any way they can, and they remain in close touch with both sides. At this stage, therefore, I do not believe that it would be helpful to add to what my right hon. Friend the Prime Minister said in answering questions on this aspect on Tuesday and this afternoon.

The right hon. Member for Salford West asked whether we wanted the company to survive. I go further: I want BL to succeed. I fully share his view that it would be a disaster for BL, a disaster for the industry and employment—not only in the West Midlands, but far beyond—and a disaster for the entire country if BL or any substantial part of it were forced by industrial action to close.

I cannot put the point more clearly than it was put by one of my predecessors, the right hon. Member for Chesterfield (Mr. Varley) when he was Secretary of State for Industry. He said:
I want all workers at Leyland, including those on unofficial strike today,"—
as some of them were—
to be quite clear that their own future employment and the future of their company is now in their hands. They can kill it or they can save it. They will have no one else to blame or to thank."—[Official Report, 2 March 1977; Vol. 927, c. 391.]

The right hon. Member for Salford, West has made a direct plea to me to intervene. In the Government's view that would not be helpful, and it would be quite inconsistent with the responsibilities and duties imposed upon the board of BL by the Government of which he was a member. This point was put clearly by the right hon. Member for Cardiff, South-East (Mr. Callaghan), who as Prime Minister said:

A new leader for the company has been appointed. He must be supported. When he chooses to follow any path, we cannot tell him that he should do something else. If we put him there, we must back him."—[Official Report, 31 January 1978; Vol.943, c. 240.]
That is precisely the position that I am in today, and it is the position of the Government. Of course, we must all hope that those who at present earn their living, whether as managers or members of the BL work force, will be able to settle their differences in time to avert the disaster that will otherwise assuredly befall them.

Mr. Clinton Davis:: Mr. Clinton Davis: How does the right hon. Gentleman equate the Government's intervention in buying off the miners' dispute with their refusal to intervene in this instance?

Mr. Jenkin:: Mr. Jenkin: The answer can be given clearly by referring to what the right hon. Member for Salford, West said. He said this was a public sector company, but he will know that although a substantial proportion of the shares are owned by the Government, both our predecessors and ourselves regard this as a private sector company. Indeed, the responsibilities conferred upon the board of a Companies Act company, which is what BL is, are precisely as set out by the right hon. Member for Cardiff, South-East. I quote his words again, because they are absolutely clear. He said of the leader of the company:

"When he chooses to follow any path, we cannot tell him that he should do something else. If we put him there, we must back him."

The Government are backing British Leyland to the tune of £990 million. When this dispute is settled, the balance of the money is there to become available on the submission of the corporate plan. We must all hope and pray that that is what happens.—[HON. MEMBERS: "Resign."]

Mr. Derek Foster (Bishop Auckland):: Mr. Derek Foster (Bishop Auckland): This is a crucial debate. I am only surprised that the Secretary of State took so long to come to the House and make any kind of statement.

Between 500,000 and 750,000 jobs are at stake. If parts of this company are liquidated, the whole of the West Midlands will be devastated. Many Conservative Members will not return to this House if that happens, and they know it. I wonder why they are not urging the Government to intervene at this stage to try to save the situation.

If parts of the company are liquidated, the repercussions will be country wide. They will certainly be felt in the North-East and in my constituency, because Eaton Axles in Newton Aycliffe and Tolwood Multifasteners do a lot of work for British Leyland. My constituents will suffer as a result of the Government's inactivity. It certainly looks as though they intend to do nothing and that they are trying to wash their hands of this whole dispute. The Prime Minister boasted yesterday of her flexibility, but here is another instance of non-intervention. Yesterday, she boasted of her intervention, but this evening the Secretary of State comes to the Dispatch Box and refuses to intervene.

Had I been allowed to move the Adjournment tonight, I should have raised the case of Chamberlain Phipps in Bishop Auckland. It is odd that the managing director of that company is a graduate of the Sir Michael Edwardes's school of charm. He boasts, too, about the art of


brinkmanship. As a result of his brinkmanship, 43 people in his company—which has only 100 employees—were sacked for taking one day's industrial action. In the eight years of that company's life 43 people were sacked through sheer mismanagement of an industrial dispute. We are talking about exactly the same thing this evening.

The people who were sacked from that company were unable to claim unemployment benefit or supplementary benefit for themselves. When they tried to claim supplementary benefit for their families, it was docked by £12 a week. Many of them underwent great hardship. A man with six children received £22 a week to keep them and his wife. Another man received £9 to keep his wife for three weeks. That is the browbeating of work forces that is going on under the Government. We should like to make certain that it cannot happen.

Oddly enough, that managing director also sent his work force a letter—a threatening one—which said that the employees would be sacked if they took one day's industrial action. That sort of approach to industrial relations is sweeping the country. People have the false idea that brinkmanship can work.

I warn the Government to ensure that this goes no further. They will reap a bitter harvest if they try to browbeat the working people of Britain in that way. Then the situation will explode in their faces exactly as it has this evening. I plead with the Secretary of State to intervene and bring the two parties back to the negotiating table and let us have an end to this dispute.

Mr. Peter Bottomley (Woolwich, West):: Mr. Peter Bottomley (Woolwich, West): An encouraging sign in the debate is that so far there have been no attacks on the trade unions. Many of the employees of British Leyland believe that a strike is the answer to what they consider to be too low a pay offer.

The question that the House needs to face—following the line of the right hon. Member for Salford, West (Mr. Orme) that this is not the place for negotiation—is whether it is right to put pressure on the management of British Leyland or the Government to increase the offer. I have not heard figures from the Opposition spokesman about the average earnings of BL employees. I believe that they are about the same as those of people in other car plants around Britain. [HON. MEMBERS: "Not true."] The figures would have been useful. If, as I believe, the average earnings are generally within pounds of each other—which I think the hon. Member for Workington (Mr. Campbell-Savours) has admitted—the question is whether British Leyland can afford another increase. It is no good considering more activity or intervention by the Government without being clear whether the Opposition or the unions are asking for extra money through the Government from other businesses.

It is also incumbent on us all to consider what is being asked for. If the Opposition are suggesting that the extra percentage of basic pay should be, say, 5 per cent. instead of 3.8 per cent.—we are told that the gap is narrow but not how narrow—if the argument is that an extra 1 per cent. or 2 per cent. on the offer would be acceptable, the House must consider whether such an increase in a company requiring vast sums of taxpayers' money is justified. Then, if 5 per cent. is justified for a company that still needs substantial financial support from the Government, how

much will be argued for in profitable companies? Again, if companies that are profitable but are not increasing their productivity or competitiveness and output by more than the 5 or 10 per cent. that would therefore seem sensible for a profit-making company have higher pay increases, what pay increases will be looked for in the public sector, teaching, the hospital service and throughout the economy?

In the past two years we have witnessed a decline in industrial production and nominal earnings increases of 50 per cent. or more. In the next year, presumably, it will be more. We have seen a vast increase in unemployment, not solely because of nominal pay increases but in large part because of agreements made by employers and trade unions. I do not argue that we should solely blame trade unions for taking what they are offered or what they can force out of employers. We need a basic degree of realism.

It is accepted that this is not the place for negotiation, but it is the place to put forward the public interest. It is in the public interest that the general level of pay increases in the forthcoming year should be kept down. Those pay increases will be nominal and not real, because we are not producing extra throughout the country to justify, or even make possible, an increase in the real standard of living. We are talking of artificial pay increases anyway. If we are talking about the level of artificial pay increases and we are concerned about the pensioner and people bringing up dependent children and all the other things that we want to do with real output, we should ask "If the pay increase for a loss-making company is more than 3.8 per cent. on basic rates, what about the rest of us?"

The Government announced that they were thinking of a basic 4 per cent. cash limit in the public sector. We should have done the same for ourselves at the beginning of the pay round, so that we were not open to snide jeers from the Opposition Bench below the Gangway.

Mr. D. N. Campbell-Savours (Workington):: Mr. D. N. Campbell-Savours (Workington): Will the hon. Gentleman give way?

Mr. Bottomley:: Mr. Bottomley: Not at the moment.

We should be willing to set an example. Even more than that, whether in the Labour Party or on the Government Back Benches, we should all be prepared to admit that the argument about more or less than 3.8 per cent. is artificial, because we have not even earned 3.8 per cent. extra on basic rates. I am prepared to give way to the hon. Member for Workington if he will answer my earlier question about the differences in average earnings among BL, Ford, Talbot and so on.

Mr. Campbell-Savours:: Mr. Campbell-Savours: The hon. Gentleman misses the point. It is not what the wage settlement costs. It is the cost to the industry if the dispute goes ahead. That is proved by the steel strike. According to Mr. MacGregor, the decision to take industrial action cost hundreds of millions of pounds. Will that happen again? The hon. Gentleman should consider what it will cost the country.

Mr. Bottomley:: Mr. Bottomley: I gave way to the hon. Gentleman on one understanding and he made a different point. If he will keep quiet for a moment, I will deal with the point he mentioned. My sole aim was to make the public interest case.

There has been no argument that the cost to the nation of artificial pay increases of 3.8 per cent. is justified. The


cost to the nation of the influence of a higher basic settlement per loss-making company is far greater than the Labour Party has been willing to admit.

We may not be talking about comparability. We are certainly talking about a grave disadvantage to those now in work who may lose their jobs, to those out of work at the moment and to the whole range of public services that most of us are trying to protect. We hope to achieve a situation that will enable us to build on those services. It would be highly irresponsible of the Government to offer new money to British Leyland to pay for an artificial pay increase.

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Newton.]

Mr. Bottomley:: Mr. Bottomley: I fully understand that British Leyland employees desire larger pay increases. Arguments this week that British Leyland should get extra money will be followed, as hon. Members said, by calls for extra money for the miners, followed by other such calls in a week's time for another group. Eventually we shall be led into a vicious spiral.

I would take more seriously the special pleading for a case like British Leyland if the trade union movement as a whole, through the TUC or in another way, were willing to say a year in advance who were to be the special cases during a 12-month period. What is clearly wrong and inappropriate is to find a special case each week and month.

The money being put into British Leyland is being put in by us as a whole. Other car workers, people in other industries, retired people and the whole community put money in. One union official said that one of the justifications for an extra increase was that the number of cars produced per man by British Leyland was vastly higher than it was a year ago. That is the kind of increase that should be paid for by bonuses and incentives. It is not justication for a substantially higher pay increase across the board.

Until British Leyland can get into the position of a company like Ford, of producing profits and getting the right level of output across the whole range of vehicles, there is no justification for extra pay. The public interest demands that there should be a better case than saying that, because workers are going on strike, more public money must be paid. If that happens we are all lost.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker:: Mr. Speaker: I hope that we can have brief speeches, because the wind-up is proposed for 10.20 pm.

Mr. David Winnick (Walsall, North):: Mr. David Winnick (Walsall, North): It would have been unthinkable if the House had prorogued tomorrow without having a debate on this very important issue. I praise my hon. Friend the Member for Bishop Auckland (Mr. Foster), who has provided the time to enable us to debate this important issue. It is absolutely disgraceful that the Secretary of State for Industry was not willing to intervene earlier on.

Let there be no doubt about the effect of any BL closure on the East Midlands. Registered unemployment in the East Midlands is now over 15 per cent. In my local travel-to-work area it is over 17 per cent., compared with less

than 6 per cent. in May 1979. There can be no way whatsoever for British Leyland to be closed down. That would turn the West Midlands into an outright industrial wasteland.

It is important to recognise that the matter affects not only those directly employed by British Leyland, for example, in Coventry and Birmingham, but many others. In my constituency and nearby—the Black Country areas of the West Midlands—much work is done for British Leyland—contract work, sub—contract work, component manufacturing and so on. A closure of British Leyland would have a devastating effect throughout the West Midlands. There can be no doubt about that.

Mr. Reginald Freeson (Brent, East):: Mr. Reginald Freeson (Brent, East): Will my hon. Friend bear in mind that it goes far wider than that and will affect places as far away as London? The largest single ratepayer in my constituency is largely dependent upon the success of British Leyland. If BL goes, a large chunk of employment in the so-called prosperous Greater London area will also go.

Mr. Winnick:: Mr. Winnick: I take my right hon. Friend's point. The attitude adopted by the chairman of BL and his colleagues towards the unions and the work force has been unfortunate. I would describe Sir Michael's attitude as abrasive and hostile. There is a great deal of suspicion and mistrust in British Leyland plants, and a feeling that Sir Michael is doing his best to undermine the authority of the unions and representatives of the work force.

Sir Michael's latest ploy seems to be similar to one that he has adopted previously, namely, going over the heads of the unions and saying to the work force, in effect, "Do not worry about the unions, ignore them, disobey what they say and do what we suggest". This time he will find that the ploy has not worked.

A group of Labour Members from the West Midlands went to see the chairman and some of his colleagues on Monday. Sir Michael laid great emphasis on the bonus. One would imagine that it would be paid to all BL's employees, but that is not the case. I understand that it is likely to be paid to only about 5,000 of the 58,000 employees. Moreover, the bonus is complex. Far from its being easily understood, even senior managers do not understand how it will be worked out. It is wrong for the public relations machine at BL to give the impression that the bonus will be enjoyed by a majority of the work force.

The Government have laid down a norm of 4 per cent. for wage rises, and I believe that the Secretary of State for Industry and his Cabinet colleagues are encouraging Sir Michael's attitude. It is all very well for the hon. Member for Woolwich, West (Mr. Bottomley) to say that there is a shortage of money. We understand all the problems involved, but the BL work force has taken wage increases well below the rate of inflation in previous years. The current rate is over 12 per cent., yet the workers are being offered a wage rise of only 3.8 per cent.

Mr. Nicholas Lyell (Hemel Hempstead):: Mr. Nicholas Lyell (Hemel Hempstead): Will the hon. Gentleman give way?

Mr. Winnick:: Mr. Winnick: No, I will not.

Of course one also has to bear in mind the point that we made to Sir Michael when we met him on Monday, namely, his salary increase of 38 per cent. It does not matter what the Secretary of State says about a 5 per cent. increase on the salary bill. There was a 38 per cent.


increase for the chairman, and in those circumstances one can understand why the work force wants a bigger wage increase than 3.8 per cent.

Mr. Patrick Jenkin:: Mr. Patrick Jenkin: It is important that no hon. Member should continue to spread wrong statements on this matter. I understand precisely what the hon. Gentleman is saying, and the topic has caused some misunderstanding and aggravation among the BL work force. I want to put on record again that the cost to BL of Sir Michael Edwardes's remuneration will have increased at an annual rate of 5.1 per cent. compound over the five-year period of his service, excluding early retirement arrangements. British Leyland's auditors have verified that figure.

Mr. Winnick:: Mr. Winnick: The Secretary of State can play with figures as much as he likes, but the work force of BL understands only too well what a substantial increase has been received by the chairman.

The Government have a direct responsibility to act to avoid a strike. The Secretary of State must not encourage Sir Michael in his obstinate attitude or encourage him to go over the heads of the unions. The right hon. Gentleman must recognise the impact that any prolonged strike in BL will have not just on the West Midlands, but throughout British industry.

My view remains that the present chairman of BL is not capable of winning back the trust and support of the work force. It would be far better if Sir Michael Edwardes went. But for the immediate moment the responsibility falls on the Secretary of State. It is his job to make sure that there are meaningful discussions between management and unions. If they were to take place before Monday, there would be every possibility that the strike would not occur. I want the Secretary of State to act in a serious way and to avoid the devastating effect of a prolonged industrial dispute at British Leyland.

Mr. Les Huckfield (Nuneaton):: Mr. Les Huckfield (Nuneaton): I speak as a Member sponsored by the Transport and General Workers Union, which has the largest membership in British Leyland, and also from a constituency point of view.

It is worth bearing in mind that for the past three years the Leyland workers have accepted wage increases of 5 per cent., 5 per cent. and 6.8 per cent., and that the increase that Sir Michael. Edwardes gave himself—and it does not matter how the Secretary of State calculates it—was £38,000. One cannot get away from that. The average take-home pay, including bonus, of workers on grade rates at British Leyland is £72 a week, and that includes the vaunted bonus about which we have heard so much in the press recently.

The 3.8 per cent. on offer to those on grade rates means a pay increase of £2.25 a week. That is what the company is offering. Sir Michael Edwardes, the company chairman, is saying that after a 40 per cent. productivity increase at Longbridge the workers can have a weekly increase of only £2.25, including the bonus guarantees that we have been talking about. That is after a productivity increase of 40 per cent. at Longbridge and 30 per cent. overall. With that kind of reward, Edwardes is saying that if the worker

dare strike against it they will lose their jobs. That is tantamount to withdrawing the right to strike from British Leyland workers.

What British Leyland workers have learnt is that accepting moderate wage settlements over the past three or four years simply does not guarantee their jobs. Since Sir Michael Edwardes has been chairman of the company, 70,000 workers in BL have lost their jobs.

According to the Henley forecasting center, if after this collapse Jaguar were to be bought by private interests and if Land-Rover were to be bought by private interests, no fewer than 427,000 workers, employed either by British Leyland or its suppliers, would lose their jobs. That is the calculation that the Henley forecasting center has made, even if Jaguar, Land-Rover and Unipart—the so-called profitable parts—were to be bought by other interests. If the Secretary of State does not think that it is worth intervening to save that number of jobs, when will he intervene?

The position gets even worse than that, for if British Leyland collapses we shall begin to see the accelerated pull-out from this country of the component manufacturers. If the component manufacturers leave, so also will what is left of the machine tool industry, and a good part of the engineering industry. Once they have gone there will be no need for Ford to stay in this country, there will be no need for General Motors, and there will be no need for Talbot. We have to calculate the effect that that would have on the steel industry and on all the other supplying and distributing industries.

If the Secretary of State still does not think that it is worth intervening to save all those jobs—and we could be talking about well over 1 million jobs—he should resign, because now a major chunk of Britain's industrial base is directly in the hands of the Secretary of State. If the right hon. Gentleman does not intervene on behalf of the Government, he will have deliberately forfeited a major part of our industrial base that we shall never recover. My hon. Friends and I have supported our constituents against Sir Michael Edwardes in the past, and we shall support them against him again. What they are striking for or what they may take industrial action for is the right to work in British Leyland for a living wage and a right to save the industry in which they are employed.

Mr. Terry Davis (Birmingham, Stechford):: Mr. Terry Davis (Birmingham, Stechford): The hon. Member for Woolwich, West (Mr. Bottomley) asked why those who work at British Leyland should be given an increase of 5 per cent. when the company is making losses. The answer that someone working at British Leyland would give to the hon. Gentleman is "Why should Sir Michael Edwardes have a 5.1 per cent. increase?" The losses are Sir Michael's losses as well as the losses of the other people who work at British Leyland.

Secondly, Conservative Members must understand that the country will pay whether a bigger increase is given to the employees of British Leyland or the company is closed. My right hon. Friend the Member for Salford, West (Mr. Orme) talked about the taxpayers' investment, but that is not the only issue. The country will pay because of the unemployment that will arise if British Leyland is closed.

I know that there is an argument about whether British Leyland employees would receive unemployment benefit if they lost their jobs through being involved in an


industrial dispute. We have been through that in the West Midlands in recent months with Ansells. But thousands of other people will also lose their jobs in other firms if British Leyland closes. They will receive unemployment benefit and supplementary benefit. Thousands will not get jobs at British Leyland and other companies if British Leyland closes. They will also receive supplementary benefit. School leavers will not have jobs and they, too, will qualify for supplementary benefit.

Every taxpayer will lose as a result of losing the income tax that is currently paid by those who work at British Leyland. The country will lose because our balance of payments will suffer. We shall lose exports and we shall have more imports. The point is that the country will pay whatever decision is taken during the next few days or weeks.

I urge the Government not to make the mistake that has been made by Sir Michael Edwardes. He has wholly misjudged the feelings of those who work at British Leyland. The auditors may say that Sir Michael has had an increase of only 5.1 per cent. for each of the years for which he has been at British Leyland. However, he has had a massive increase this year at the time of the current negotiations. It is what people feel that matters. Those who work at British Leyland feel immense resentment at learning that Sir Michael Edwardes has had an increase amounting to thousands of pounds when they can have only an increase of 3.8 per cent. As they see it, that is what is being presented to them on the basis that they can take it or leave it.

The misjudgment was compounded by the infamous letter. That was the greatest mistake that Sir Michael Edwardes and his board could ever have made. I urge the Government not to make matters worse by underestimating the feelings of British Leyland employees about Sir Michael Edwardes.

I urge the Government to intervene and to talk to trade union representatives and directors. The Secretary of State has admitted during this short debate that he has already been talking to Sir Michael Edwardes. He referred to what Sir Michael told him. Why will the right hon. Gentleman not talk to trade union representatives in an attempt to prevent the closure of British Leyland?

At the very least, if British Leyland closes and all those who work there lose their jobs, will he make it clear that it will apply to Sir Michael Edwardes as well as to the rest?

Mr. Nicholas Lyell (Hemel Hempstead):: Mr. Nicholas Lyell (Hemel Hempstead): The arguments advanced by Labour Members in this debate do not hold water. They are asking the Secretary of State to intervene for one of two reasons—to take over the negotiations or to put up more money. They cannot seriously be asking him to take over the negotiations in place of one of Britain's most skilled managers, whatever they think about individual handling of the issue. That would spell disaster for the management of every independent business in the public sector that they wish to preserve.

Secondly, they call for more money to be put up at a time when the unit labour costs of Leyland, although they have improved massively, have not reached the good levels necessary to compete internationally. The notion that the Government should put up more money for a pay increase that is not justified largely because Labour Members do not like the way in which negotiations have

been handled spells, once again, disaster. The third and worst argument put forward is that if this company were allowed to go to the wall it would have a disastrous effect on a large number of jobs. That is an argument that can, sooner or later, be used in any strike anywhere.

It is not a question in principle of the number of jobs. The more jobs that are involved, the more important it is that we as a nation should face up to the problem. If we pay more money simply because a large number of jobs are at issue and thus reduce the ability, whether in the mines or in Leyland, to get the right unit labour costs to compete in the long term, we shall never solve our problems.

Mr. Orme:: Mr. Orme: With the leave of the House, I wish to put one or two points again to the Secretary of State. This has been a short but important debate but next week we may face a major crisis in British industry. For that reason, we feel that the Secretary of State this evening has not answered the central points that we have made. He has referred—

Mr. Nicholas Baker (Dorset, North): Mr. Nicholas Baker (Dorset, North) rose

Mr. Orme:: Mr. Orme: I have only a couple of minutes. I shall not give way.

The right hon. Gentleman has referred to previous positions and statements made by previous Ministers. No previous Minister or Prime Minister has been faced with the threat of a closure of a major company employing so many people. I ask the Secretary of State not to quote previous Ministers but to stand on his own feet and take positive action. He has discussed the matter with Sir Michael Edwardes and the board. Knocking on his door tomorrow will be some major trade union leaders asking the right hon. Gentleman to intervene in the dispute. They will include Mr. Alex Kitson of the Transport and General Workers Union Mr. Cure of the AUEW and other trade union leaders. Will the Secretary of State see those trade union leaders tomorrow before the dispute starts, listen to their side of the argument and see whether they can play a major part at this eleventh hour?

Comparisons have been made with other companies and car workers generally. I am informed that there is a type of guaranteed payment at some companies, such as Ford, which are not paralleled at British Leyland. Car workers generally are not at the top of the scale in earnings. They are very low down the scale. We are talking about men who work on a conveyor belt for 40 hours taking home net payments of about £72 a week, including bonus.

We do not want the matter to be left where it is. I welcome the fact that there has been a large attendance of Labour and Conservative Members for this important debate. I have not seen any members of the Liberal Party or the Social Democratic Alliance. We welcome the fact that the debate has taken place. We have had to force it out of the Government, but it has taken place. However, the debate is not the end of the issue. We do not sit back now and wait for the dispute.

I hope that the Secretary of State will take away the views put by Opposition Members and initiate negotiations over the weekend that can get this dispute resolved. It is on that basis, I believe, that the Secretary of State has a duty not just to his Government but to the British people and to this Parliament.

Mr. Patrick Jenkin:: Mr. Patrick Jenkin: With the leave of the House, Mr. Speaker, I should like to reply very briefly to the debate.

The debate has served a useful purpose. The poll in The Sun this morning showed that only about 30 per cent. of the work force of BL believe that a serious strike will result in the closure of the company or large parts of it. I think that the remaining 70 per cent. are very wrong. Virtually every word that has been spoken by every speaker in this debate has shown very clearly that that is not a view shared in this House. I think that everyone has recognised that with this prospective strike at BL we are facing a desperately serious situation which could well result in the closure of the company or large parts of it.

One of the most important facts that will emerge from this debate is that right hon. and hon. Members are in no doubt whatever that it is for real. If the debate serves no other purpose, that will be a valuable result.

My hon. Friend the Member for Woolwich, West (Mr. Bottomley) and a number of other hon. Members asked about figures for pay. Perhaps it would be helpful if I placed one or two figures on the record.

Mr. Winnick:: Mr. Winnick: Will the right hon. Gentleman give way?

Mr. Jenkin:: Mr. Jenkin: No. I shall answer the hon. Gentleman, because he raised a specific point which I should like to answer.

The fact is that, whatever the basic pay increases may have been over two or three years, in both 1980 and 1981 the increase in average earnings of BL employees has been above the increase in prices. In 1980 the rate of inflation was virtually 18 per cent.; the increase in average earnings was 20.6 per cent. In 1981—for the 10 months since 1 November 1980—the rate of inflation has been 9.6 per cent.; the increase in average earnings has been 13.5 per cent. Although the increases in basic rates have been of the low figures quoted by the right hon. Member for Salford, West (Mr. Orme), the increases in earnings—I am quoting them before tax and national insurance, in the normal way—have been higher than the increase in the cost of living.

The right hon. Gentleman suggested that pay at BL was significantly below that of other car workers. A great many comparisons can be made; some are below, and some are above. However, the average production worker at BL, including the average bonus, earns at present £105.50. The average production worker at Fords, getting the attendance allowances that Ford pays, earns £103.50. So the BL worker—

Mr. Les Huckfield:: Mr. Les Huckfield: It is guaranteed money.

Mr. Jenkin:: Mr. Jenkin: With the greatest respect, it is earnings. It is money in the pay packet, and it is that which counts.

I come to the hon. Member for Walsall, North (Mr. Winnick). The fact is that the average bonus that has been earned in BL is £11.50. Most of BL's employees already earn good bonuses. The hon. Gentleman seemed to suggest that only 5,000 people were earning the bonus, if I understood him rightly. The effect of guaranteeing the first £3.50 of the bonus would help 5,000 people who at present do not come up to the level of the guarantee—the first £3.50—so the hon. Gentleman got it completely wrong. The full offer that has been put on the table by the management of BL would help those 5,000 who at present do not reach that level.

I make one other point in closing. Opposition Members have been free in their criticisms of Sir Michael Edwardes. It is their perfect right to be critical of me. They have concentrated, quite wrongly in some cases, on his salary. What is a little sad is that not one Opposition Member has seen fit to recognise that in the last two and a half years Sir Michael Edwardes and his board have given—[Interruption.] Of course, as I have said, with the full co-operation of their workers. They have given the company something that it has not had for many years—the chance of a real and viable future. That is what we want—

The Question having been proposed at Ten o' clock and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at half-past Ten o' clock.